The Collaborative International Dictionary of English v.0.48:

Demarcation \De`mar*ca"tion\, n. [F. d['e]marcation; pref.
   d['e]- (L. de) + marquer to mark, of German origin. See
   Mark.]
   The act of marking, or of ascertaining and setting a limit;
   separation; distinction.
   [1913 Webster]

         The speculative line of demarcation, where obedience
         ought to end and resistance must begin, is faint,
         obscure, and not easily definable.       --Burke.
   [1913 Webster]

WordNet (r) 3.0 (2006):

demarcation
    n 1: the boundary of a specific area [syn: limit,
         demarcation, demarcation line]
    2: a conceptual separation or distinction; "there is a narrow
       line between sanity and insanity" [syn: line, dividing
       line, demarcation, contrast]

Moby Thesaurus II by Grady Ward, 1.0:

68 Moby Thesaurus words for "demarcation":
   alteration, analysis, anatomization, atomization, ban, bar,
   barring, blockade, bounding, boycott, change, circling-in,
   circumscribing, circumscription, contradistinction, debarment,
   debarring, definition, delimitation, desynonymization,
   determination, differencing, differentiation, discrimination,
   disequalization, disjunction, distinction, distinctiveness,
   distinguishment, diversification, division, embargo, encincture,
   exception, exclusion, hairsplitting, inadmissibility,
   inclusion-exclusion, individualization, individuation, injunction,
   lockout, microscopic distinction, modification, narrowing,
   nice distinction, nonadmission, nuance, omission,
   particularization, personalization, preclusion, prohibition,
   rejection, relegation, repudiation, restriction, segregation,
   separation, severalization, severance, shade of difference,
   specialization, specification, subtle distinction, taboo,
   trichoschistism, variation