If a man does not keep pace with his companions, perhaps it is because he hears a different drummer.

Henry David Thoreau

Differentiation is the adjustment of the teaching process according to individual needs.  It can used with whole groups, small groups or individuals.

Here is a good starting point:

St. Mary’s College of Maryland

Here are more Definitions:

By differentiation the authors mean making changes, from small changes to larger ones, which enable children to learn from the school curriculum, designed for their age group, with their peers in an inclusive schooling system.

Downs Syndrome Network

The best way to meet pupil’s different learning needs is to deliver the curriculum in a number of different ways; to differentiate the vehicle by which the skills, knowledge and concepts arrive, as well as presenting a range of tasks. The reason for doing this is because it ensures the maximum amount of pupil involvement, ie pupil planning, pupil assessment and pupil decision-making. In fact, the three can be fitted into a logical progression of teach, practice and assess: 

‘The key to the differentiated curriculum is the flexible use by teachers of a wide range of activities and lesson organizations.’

Differentiation an approach to Learning

Differentiation is not more class or home work, it is taking a regular curriculum topic and exploring it in greater depth and complexity. This means instead of learning algebraic formulas and practicing them in a classroom setting, through the use of worksheets and the text book, you might apply them to "real life" situations.

http://www.k12.hi.us/~gtstate/the_role_of_the_teacher.htm 

Differentiation is the recognition of and commitment to plan for student differences. A differentiated classroom provides different avenues to acquire content, to process or make sense of information and ideas, and to develop products. The goals of a differentiated classroom are to maximize student growth and to promote individual student success.

http://curry.edschool.virginia.edu/hottlinx/tier1/faq/faq.htm

Differentiation is the matching of work to the differing capabilities of individuals or groups of pupils in order to extend their learning.

Ofsted