Proofreading is for very-almost-finished documents, immediately prior to submission or publication. It looks for things like typos, lost punctuation, spelling mistakes, issues with formatting, and grammatical errors. Proofreading is appropriate for texts which will no longer significantly change, like the final draft of a thesis, or an article or book manuscript.

Line editing deals much more with prose and style. When line editing I read more slowly, and alongside proofreading the text, I also make suggestions about changing things that aren't necessarily mistakes, but which would improve the flow or understandability of the text. In line editing whole sentences will often end up being reworded, very long sentences broken down, and awkward phrases or unclear formulations improved. This is often the sweet spot in terms of language editing, as I take more time to think about the reader's experience with fresh eyes. In line editing, major improvements can be made to a text without the author being required to substantively redraft or spend excessive time responding to, or deciding upon, comments and suggestions.

Developmental editing, which takes place at an earlier stage of manuscript preparation, gets involved with more substantive elements like argument and structure. It engages with, and makes suggestions about, the clarity of the argument, whether the evidence and analysis support the argument, whether the structure is logical, who the intented audience is, what could be missing, what could be superfluous, sections that might need to be moved around, and so on. This is a good option for pre-submission manuscripts or when wrangling with turning thesis material into publications, but not so much right before you're about to send something off.