Git `rebase` is a powerful tool that can be used for integrating and exchanging work between two branches, as well as rewriting history. It differs from `merge` in its ability to apply commits from one branch onto another, allowing users to stay in sync with the latest changes and deal with potential conflicts earlier. Interactive rebasing enables users to reorder, rename, remove, split, merge, or change commit messages directly within their own branches. Conflicts that arise during a rebase can be resolved using Git's built-in tools, and recorded resolutions can be reused for the same conflict in the future.