The Collaborative International Dictionary of English v.0.48:

Differentiation \Dif`fer*en`ti*a"tion\, n.
   1. The act of differentiating.
      [1913 Webster]

            Further investigation of the Sanskrit may lead to
            differentiation of the meaning of such of these
            roots as are real roots.              --J. Peile.
      [1913 Webster]

   2. (Logic) The act of distinguishing or describing a thing,
      by giving its different, or specific difference; exact
      definition or determination.
      [1913 Webster]

   3. (Biol.) The gradual formation or production of organs or
      parts by a process of evolution or development, as when
      the seed develops the root and the stem, the initial stem
      develops the leaf, branches, and flower buds; or in animal
      life, when the germ evolves the digestive and other organs
      and members, or when the animals as they advance in
      organization acquire special organs for specific purposes.
      [1913 Webster]

   4. (Metaph.) The supposed act or tendency in being of every
      kind, whether organic or inorganic, to assume or produce a
      more complex structure or functions.
      [1913 Webster]

WordNet (r) 3.0 (2006):

differentiation
    n 1: a discrimination between things as different and distinct;
         "it is necessary to make a distinction between love and
         infatuation" [syn: differentiation, distinction]
    2: the mathematical process of obtaining the derivative of a
       function
    3: (biology) the structural adaptation of some body part for a
       particular function; "cell differentiation in the developing
       embryo" [syn: specialization, specialisation,
       differentiation]