The key difference between cellular differentiation and cell division is that cellular differentiation is the process of forming a variety of cell types that have specific functions while cell division is the process of splitting a parent cell into two daughter cells.
The cell is the basic structural and functional unit of living organisms. Multicellular organisms develop from a single diploid cell called the zygote. Zygote makes many cells by cell division. Then the cells become specialized in order to fulfill specific and unique functions within the organism. Making many cells from a single cell takes place via cell division. Forming specific cell types from a cell takes place via cellular differentiation. Both cell division and cellular differentiation are vital processes occurring in multicellular organisms.