Teal compiles teal files into plain Lua just like TS does for JS. So all the advantages and disadvantages apply.

Luau is a backwards compatible superset of Lua that comes with it's own performance-tuned runtime. It offers more than just gradual typing.

So they are very different things. You can use Teal in cases when you don't control the runtime. Like write a Love2d game or your neovim config in it. Anywhere where Lua runs, you can use teal.

On the other hand Luau can offer superior developer experience because you don't have a separate compile step. They can do a lot more things that are impossible with teal as they have their own runtime and types do not get erased by compiling.