Variation refers to a modification in structure, form or function in an organism, deviating from other organisms of the same species or group. It occurs due to genetic diversity in a population or species as a result of new gene combinations (e.g. crossing over of chromosomes), genetic mutations, genetic drift, etc. Genetic variation is important in that it may provide alternative phenotypes which may respond to the environment in different ways and also helps to maintain biodiversity among species.
Speciation refers to the formation of new and distinct species in the course of evolution.
Evolution is the continuous and gradual process by which different kinds of living organisms are thought to have developed and diversified from earlier forms during the history of the earth. It results in the gradual development of organisms from a simple to a more complex form.