Defuse is to remove the fuse from (an explosive device): “The bomb sqaud had to defuse the bomb before they could enter the building.” As an extension, is also means to make less dangerous, tense, or hostile: “One generally needs a calm head to defuse the crisis.”
Diffuse is to widely spread or scattered; not concentrated: “The room was filled with a soft, diffuse light.”
The fan in the window helped to diffuse the fumes from the chemicals used for a bomb which the police had to defuse before the basement was safe again.
