Static and Dynamic Data Masking

Static data masking will replace sensitive data at rest and this operation is usually irreversible. This is usually used to build data warehouse or data mart for analytical purposes where sensitive data is not required; it is also used to generate DEV and TEST environments using production data.

Dynamic data masking will replace sensitive data in transition. The original data stored in the database will not be altered. When users issue query to retrieve the data, dynamic data masking process or engine will mask the data based on settings and users' access or roles. 

References

Dynamic data masking (Azure SQL Database)