What is the difference between a CSU DSU and a modem?

The DSU provides a modem-like interface between the computer as Data Terminal Equipment (DTE) and the CSU. The Data Service Unit (DSU) manages line control, and converts input and output between RS-232C, RS-449, or V.xx frames from the LAN and the time-division multiplexed (TDM) DSx frames on the T- carrier line it will also manage timing errors and signal regeneration.

The Channel Service Unit (CSU) receives and transmits signals from and to the WAN line and provides a barrier for electrical interference from either side of the unit. The CSU can also echo loopback signals from the phone company for testing purposes.