If you invite a friend to your home, she is your guest. You might announce to your parents that you've invited seven guests for Thanksgiving.
Someone who's visiting, or who's been asked to come, is a guest. If your next door neighbor comes over for lunch, she's a guest, and every one of the two hundred people you invite to a wedding is also a guest. You're often referred to as a guest when you stay at a hotel, too. The Old English root of guest is gæst, "a stranger" or "an accidental guest."