It depend on context. For example:
1. 我走了很久了,需要歇/休息一下。
Here means I need to take a rest, maybe sit down or lay down for a while, maybe go to sleep.
2. 很晚了,我要休息了。
It means I need to go to bed now. You can'd use ‘ 歇 ’ instead here. But you could use a phrase ' 歇息'.
It also depend on where the speaker come from. Different area. different custom and localism.