Everything has two principles that explains its being, essence and existence. In all beings except for God, these principles are both required in order for the actually existing individual thing to be. Each is distinct from the other, yet this distinction is a real, not merely logical, one. The following explanation summarizes the main argument of On Being and Essence, Chapter 4, which can be found by following this link.
Essence may be described as the “what” of a thing. It is the quiddity of the thing, that which is known about it by our forming of a concept. It is a formal principle since for material reality, it is abstracted by the human intellect. Hence, it is a universal principle making many material individuals to be of the same kind (for angels, it makes each angel to be a species unto itself). But, it is obvious upon reflection that “what a thing is” and “that it is” are completely different statements.
That a thing is or has existence, is a principle really distinct from its quiddity. In no case (except for God) does the essence of a thing indicate anything about whether that thing really is. The essence of a horse that exists, and the essence of a horse that doesn’t are absolutely the same, namely horse-ness; a horse’s existing is totally different from what kind of a thing it is. Therefore, there must be something about really existing things that accounts for this very existing, and it is not their essence; it is their existence. Existence then is that which makes essences to be, to exercise the act of existing. St. Thomas indicated the activity of being, existence, with the Latin of “to be”, esse.
By saying that existence is the act of being (esse) exercised by beings, Thomas understands it to be similar to form, in that it actualizes a potency as form actualizes matter. Taking the notions of an act/potency relationship learned from cosmology as form and matter, he expands the notion of form by means of analogy. Just as the substantial form of a material being determines and makes actual some part of matter, so esse actualizes the potency of a thing’s essence. This similarity is an analogous one because, the esse and essence of a thing are not separable in real beings, as the form is separable from matter in abstraction; the two are only distinguishable because of their own very real distinction. Esse is logically prior to all other actuality because a thing cannot be in a certain way unless it simply is. So, because of this logical priority of existence, Thomas calls it “the most formal of all.” “It is the actuality of all acts” since a thing is in virtue of esse and “acts are of supposits.”
Originally posted by Aquinas Online.