A pillow is a cushion that you rest your head on in bed. A cushion encompasses other meanings too. For instance, there are cushions on a couch. It is the soft pad on which you sit. A cushion can also be placed under your lower back, under your knees, etc. for support.

Pillow is used for sleeping but cushion makes floor or chair more comfortable (is used for sitting)

This patio set has cushions on it too: http://www.nygeekcast.com/wp-content/uploads/2014/05/cool-Patio-Outdoor-Furniture-Cushions-in-maroon-with-black-iron.jpg

This patio chair has cushions on it: http://homehdwallpaper.biz/wp-content/uploads/2014/09/patio-chairs-with-cushions.jpg

This woman is resting her head on a pillow: http://messagenote.com/wp-content/uploads/2011/02/foam-pillow.jpg These people are sitting on the cushions of the couch: http://ronetlcnaptown.files.wordpress.com/2013/06/couple-sitting-on-couch.jpg