LastModifiedDate is the date and time when a record was last modified by a user.
SystemModstamp is the date and time when a record was last modified by a user or by an automated process (such as a trigger). In this context, "trigger" refers to Salesforce code that runs to implement standard functionality, rather than an "Apex trigger".
As a result, LastModifiedDate and SystemModstamp will differ when automated processes update the records, which will happen in the following scenarios (asynchronously in some cases):
a) The archive date is extended to greater than 365 days.
b) An existing picklist value is updated (not replaced with an existing picklist value).
c) A contact's e-mail address is flagged as per the Email Bounce Management configuration.
d) The LastActivityDate field is modified
e) Roll-up summary field is created, which will update all the parent records' SystemModstamp asynchronously. Recalculation will also take place if the Summary Type is updated.
f) Some Salesforce Internal backend processes also update SystemModstamp as SystemModstamp is used internally to signal that a record (or related data) may have changed and that internal processes may need to synchronize themselves to the new record data.
I have a custom picklist field in Account called Brand__c. I will change one of the picklist value from Toyota to Honda. This field is also set for tracking.
Before I do that, let me query all the records where brand is Kia
SELECT Id,Name,Brand__c,LastModifiedDate,SystemModstamp FROM Account WHERE Brand__c = 'Toyota' ORDER BY LastModifiedDate
As you see here, all records have LastModifiedDate = SystemModstamp
Now, let me update the picklist value from Toyota to Honda. Salesforce by default will auto update all records where Brand__c match Toyota to Honda.
Then let's do another query.
SELECT Id,Name,Brand__c,LastModifiedDate,SystemModstamp FROM Account WHERE Brand__c = 'Honda'
Notice here that SystemModstamp is updated, but LastModifiedDate stay the same. As this field also enable for tracking, let's check to Account History.
The value change is not tracked and Last Modified By also stay the same.
Another sample here when user try to send email to invalid email address.
Email Bounce Management will mark the email address as invalid, this will update SystemModstamp, but the LastModifiedDate will stay the same.