A distinction which runs through the whole development of human thought has become blurred during the past two hundred years. Implicit in all ancient philosophy, acknowledged by medieval scholastics and the natural philosophers of the Renaissance, and even by Locke and Newton, is a difference of kind, if not of value, between wisdom and understanding.
By wisdom was meant an intuitive apprehension of truth, and the attitude involved was receptive or contemplative. Intellectus was the name given to this faculty in the Middle Ages.
Understanding, on the other hand, was always a practical or constructive activity, and ratio was its name — the power by means of which we perceive, know, remember and judge sensible phenomena. Philosophy was conceived as an endeavour to perfect this constructive power of the mind as an aid to wisdom.
To clarify perception, excluding all distortions due to emotion and prejudice; to analyse statements so that our knowledge is consistent; to establish facts, so that our memory is consolidated; to bring the inquiring will into harmony with the intuitive intellect, so that our judgment is true and constant — such have been the aims of all who called themselves philosophers.
See also: "The Forms of Things Unknown: A 1963 Essay on the Role of the Creative Arts in Society," Brain Pickings, August 29, 2012