Acharya Prashant clarifies the distinction between consciousness and awareness, stating that they are not the same. Consciousness is the state of being aware of thoughts, feelings, and the external world, which often represents mental disturbance. Awareness, or true understanding, occurs when consciousness becomes pure, quiet, and dissolves back into its source, leading to the cessation of thought waves. He emphasizes that consciousness is the Self only when it is pure and free from the ego; otherwise, what we call consciousness is merely the mind or the ego.