What's the difference between "from the ground up" and "from scratch"? can they be used interchangeably?

The two phrases often have similar meanings and uses, but in many cases are not interchangable. For example, in “She made the cake from scratch”, which means she made the cake from separate ingredients rather than from a mix, from the ground up won't substitute properly for from scratch. Another instance where that substitution won't work is “The cave grew its stalactites from scratch”.

Generally, from scratch has two senses: “From the beginning; starting with no advantage or prior preparation” and “From basic materials or raw ingredients” (wiktionary). From the ground up has one sense: “From the beginning; starting with the basics, foundation, or fundamentals” (wiktionary). For example, if you are talking about developing a theory from first principles, from the ground up is more suitable than from scratch due to its foundation or fundamentals connotation. If you want to emphasize building something from basic components, from scratch may be better.

They have very similar meanings, but come are derived from entirely unrelated areas of life.

"From the ground up" is a construction metaphor, speaking of starting a project anew, beginning with the foundation.

"From scratch" is apparently a sports metaphor, although more commonly used these days as a cooking reference, as in to say that you gathered all the raw ingredients yourself (as opposed to buying a cake mix).

In the context of starting a project over, it would be appropriate to use either phrase, as in "Now we're going to have to start from scratch" or "Now we're going to have to start from the ground up", as well as many other similar metaphors (square one, from the top, etc)...