STUFF() can be used to stuff a string into another string. It inserts the string at a given position, and deletes the number of characters specified from the original string.

-- © 2011 – Vishal (http://SqlAndMe.com)
 
DECLARE @string1 VARCHAR(20) = 'Microsoft Server'
DECLARE @string2 VARCHAR(20) = 'SQL Server 2005'
 
SELECT      @string1 + ' -> ' + STUFF(@string1, 11, 0, 'SQL ')
            AS 'String 1',
            @string2 + ' -> ' + STUFF(@string2, 15, 1, '8 R2')
            AS 'String 2'

Result Set:

String 1                                 String 2
—————————————- ————————————-
Microsoft Server -> Microsoft SQL Server SQL Server 2005 -> SQL Server 2008 R2
 
(1 row(s) affected)

In the first string it inserts 'SQL ' at specified position – 11, the third argument 0 indicated the number of characters to be deleted before inserting the new string.

For second string, we have deleted one (1) character starting from position 15, which deletes '5', and then it inserts the new string at position 15 – '8 R2'.

REPLACE():

REPLACE() replaces all the specified characters with new characters.

DECLARE @string3 VARCHAR(35) = 'sql 2005, sql 2008, sql 2008 r2'
 
SELECT @string3, REPLACE(@string3,'sql','SQL')

Result Set:

———————————–      ———————————–
sql 2005, sql 2008, sql 2008 r2   SQL 2005, SQL 2008, SQL 2008 r2
 
(1 row(s) affected)

However, it is not limited to same number of characters:

DECLARE @string3 VARCHAR(35) = '2008 R2'
 
SELECT @string3, REPLACE(@string3,'20','SQL Server 2')

Result Set:

————–       ————————
2008 R2              SQL Server 208 R2
 
(1 row(s) affected)

Hope This Helps! Cheers!