There is a difference in being popular and being famous. 

Even if you hate Nintendo and never played or heard about any Nintendo games, You would know who Mario is...

True, but I would say pikachu is more both than Mario.  Mario is more know to people that play games.  pikachu is more universal.

Plus, how many people do you know that can speak Mario?  Myself and many others are fluent in pikachu's language.  And many people it's their only 2nd language.

Translation:

Pika, pika, pika, pik, pikachu!

I gotta go with Mario. He's Mr. Nintendo. Heck, he's probably the face of modern video games in general. He's also one of the few household names from the video game industry.

Pikachu is up there, though.

P.S. topic makes me think of the scene in Ghostbusters 2 when Louis asks Janine if she wants to play Super Mario Bros. :)

It really is no contest. Mario is the most famous name in video games. People who know absolutely nothing about video games will likely know exactly who Mario is - but Pikachu they may easily not know. "Pokemon" is the name everyone will know - that does not necessarily translate to knowing Pikachu. 

When your series is named after you that helps a lot in terms of notoriety. It's why so many people who know nothing about video games mistakenly believe Link's name is Zelda - because that's the famous name there. I like to use my parents as a barometer for these things - if I believe my parents, who know nothing about video games and couldn't care less, have heard of them then it's a sign they're really that famous. My parents absolutely know who Mario is, I know they know Sonic the Hedgehog, they probably know Donkey Kong and Pac-Man. But that's probably about it. They'd know the name "Pokemon" for sure, but that wouldn't translate to knowing Pikachu. In fact, I think I recall in my child hood my mother mistaking Pokemon for "Pokey Man" and thought that was Pikachu's name. In a similar way to her thinking Wolverine was "X-Man"

But, anyway, in the case of Mario... even if the Pokemon games were called Pikachu, he'd still have nothing on Mario. I mean, it's Mario. At one point in time he was the most easily recognized fictional character of all time worldwide - beating Mickey Mouse.

Easily Mario.

Everybody and their mother knows who Mario is or at least recognizes him. Even in underdeveloped regions of the world, even to people who never even seen a video-game. He's for all ages and up there with Mickey Mouse as the most recognizable figure in popular culture. Pikachu's big for sure, but his fame doesn't go far beyond the young gaming audiences.

Mario by far, he is on the most products and merchandise in stores.

It is Mario.
Pikachu is known to a generation or two. Mario is known by every generation since the 80s
There are more references to Mario than Pikachu in movies. More youtube videos of something Mario related than Pikachu. Mario has been on just about everything even cereal.

Famous? I would like a defenition for that term, but either way, its likely mario is the most known.

A good way to check things like this is googling the name and seeing how many results come up. Who has a bigger presence on the internet is a good comparison to who has a bigger presence in general.

Mario: 642 million hits (Super Mario has 272 million if you want to be stingy, but really, when you google Mario he's the only one that comes up)

Pikachu: 31 million hits.

It's not a contest.

And just for giggles, here's some other famous video game characters:

Mega Man: 306 million (but, one does need to keep in mind the generalness of those words could mean a lot of other results, although the first page is all Mega Man)

Pac-Man: 130 million

Master Chief: 124 million (same problem as Mega Man though)

Luigi: 123 million

Zelda: 71 million hits (No real way to check Link as his name is a word, and bear in mind some of these undoubtedly refer to Zelda Fitzgerald)

Kirby: 66 million (again, other Kirbys exist)

Yoshi: 32 million

Sonic the Hedgehog: 23 million hits (just 'Sonic' is 231 million, but in fairness, the first result is the burger franchise)

Donkey Kong: 23 million hits

Bowser: 15 million

Lara Croft: 15 million

Nathan Drake: 14 million

Solid Snake: 13 million

Samus: 6 million

Ganon: 5 million