Full replication is used where constituents are liquid and few, for example a large-cap index of 100 names. It gives the tightest tracking but forces the fund to trade even tiny, illiquid positions at every rebalance.
Sampling, also called optimised replication, is common for broad bond indices with tens of thousands of line items, or for emerging-market equity indices with hard-to-access members. The fund holds perhaps 3,000 of 10,000 bonds, matched on duration, credit quality and sector, accepting slightly wider tracking-error in exchange for far lower trading costs.
Sampling introduces model risk: the sample matches the index on the dimensions the optimiser was told about, and can diverge on the ones it was not. See synthetic-replication for the derivative-based alternative.
Related: synthetic-replication, tracking-error, tracking-difference, index-fund, etf, liquidity