There is a lot of difference between a confederation and a federation :
A confederation is a temporary association of a number of states which retain their sovereignty even after the formation of the confederation. A federation is a permanent union of states which retain their sovereign character after the formation of the federal union. The federation emerges as a new sovereign state. The component units of a confederation retain their statehood, whereas units of a federation are called states merely by courtesy.
Central body of the confederation passes resolutions which have only a recommendatory character since these are to be enforced by the government of the component states according to their free will. The federal legislature, on the other hand, passes laws which are binding upon all the citizens and the component states cannot go against them.
Citizens in a confederation owe allegiance only to the states wherein they live but citizens in a federation enjoy double citizenship and owe allegiance to the states of the domicile and the federation.
A confederation does not create a new nation but a federation gives birth to a new nation.
The member-states of a confederation can secede from the union but it is not possible in case of a federation.
The degree of unity in a federation is deeper than in the case of a confederation since a confederation is just a temporary and superficial union among some independent states.
Points to Remember
(a) International administrative unions are formed by a number of sovereign states for some specific purpose.
(b) A personal union is a union of a number of states under the same king though the component states retain their separate governmental organization.
(c) A confederation is a loose association of various sovereign states for specific purposes like foreign affairs, defence, inter-state trade etc. There is a lot of difference between a confederation and federation.