I fell into a burning ring of fire,
I went down, down, down, while the flames went higher.
--Johnny Cash, "Ring of Fire"
A Fallen angel has cast off the last of its divinity and become a demon. This is usually due to failing a dissonance roll while already Outcast, but an angel can also deliberately choose to Fall if it wants.
Once an angel has Fallen, it becomes whatever Band serves as the opposite of its Choir: Seraphim become Balseraphs, Cherubim become Djinn, and so on. It does not get a new Heart until it pledges its loyalty to a Demon Prince.
Malakim are the exception -- no Virtue has ever Fallen since the Choir was created. Angels claim the Malakim cannot Fall, while demons say it's because the Choir polices itself so well. (In this particular campaign, they may have a point -- see the non-canonical Dark Malakim).