Star Wars Knights of the Old Republic II: The Sith Lords/Difficulty Classes

Difficulty adds +5 to each skill check in the game for a total of +10 on 'Difficult'. The game's difficulty can be changed at any time (explained in the prologue) if you encounter a 'skill too low' check. These are the obvious differences, however a Reddit post goes into more detail;

(AUTHOR UNKNOWN )

"First and foremost, enemies deal 50% more damage on Hard compared to Normal. This one is simple enough to understand. If an enemy has a weapon that can deal 1-10 damage and they roll an 8, you'll take 12 damage. I'm not sure how the game handles decimals, though (i.e. if the enemy rolls a 7, they would deal 10.5 damage ... is that 10 or 11?).

UPDATE: I forgot to mention something. On Easy, enemies deal 50% less damage than on Normal.

Second, your PC (that is the playable character) can receive critical hits from enemies. On Normal, even if the enemy scores a critical hit, which would result in a extra damage, it deals damage as if it were a regular hit. This restriction (or protection) does not exist on Hard.

The third relates to 'Attacks of Opportunity'. KOTOR and KOTOR2 both feature round based combat, i.e. you attack, then the enemy attacks, then you attack, and so on and so fourth. Attacks of Opportunity, however, can be performed once per turn in addition to whatever action that character is performing, as long as the character is unarmed or wielding a melee weapon, within striking range of the relevant target, and the conditions for an AoO are met.

On Hard, an if you use a ranged weapon or medkit, repair kit or stimulant within melee range of an enemy who is unarmed or wielding a melee weapon, they are granted an AoO. On Normal, you are not venerable to AoOs in these situations.

For this reason, it is important to switch from a ranged weapon to a melee one if an enemy comes within melee range of you. Furthermore, you are better off training ranged units in the Repair and Treat Injury skills. By doing so, you can rely on them to heal your party without risk of granting an AoO to enemies. Imagine if you're playing a lightsaber wielding Jedi while surrounded by three enemies and decide to use a medkit; not only do you deal no damage that turn, but those thee enemies have the potential to deal double damage to you.

There are three other variables, but two are are unchanged between Normal and Hard, only making a difference when you play on Easy, and one, while available to be set when modding, isn't active on any of the default difficulty settings. For completeness, I'll list them anyway:

Fourthly, on Easy, the minimum amount of damage the PC will do if it lands a hit is 50% of their weapon damage, i.e. if you have a weapon dealing 1-10, it will never deal under 6 damage. On Normal and Hard, you can deal the full range (1, 10 and every value in between).

Fifth is that, on Easy, enemies will never deal more than 50% of their weapon damage, i.e. if they have a weapon dealing 1-10, it will never deal more than 5 damage. On Normal and Hard, enemies can hit you for the full range (again, 1, 10 and every value in between).

And, finally, the sixth is available in KOTOR2's settings, but isn't activated on Easy, Normal or Hard, however, you can manually activate it with 'KOTOR Tool' and possibly even KSE (KOTOR Savegame Editor). It is called MinHP1 and prevents the PC from dropping below 1 HP, i.e. you can never die."