I need to upload multiple document from multiple teams in a site. Can anybody please tel me which option is more suitable(document set or document library)
How do they differ from each other.
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You can treat document sets as folders inside document library, it's the same idea, but you can do stuff with document sets that can't be done in folders. Document Set is a group of documents which are stored as one unit.A document library is a place which can hold individual documents or document sets.
You can consider following point to choose between these two:
Additional Information on grouped content
Ability to specific default metadata
Synchronization of Metadata
Versioning of Individual Documents
Running workflows on multiple items with SharePoint Designer
Provisioning of Default Content
For detailed difference check