Nation

nation

[< Anglo-Norman nacion, nacioun, naciun, nation, natiun, etc., and Middle French nacion, nation (early 12th cent. in Old French in plural as naciuns denoting gentiles; late 12th cent. in senses ‘birth’, ‘a people united by common language and culture’, and ‘family, lineage’; early 13th cent. in sense ‘descendants’, early 14th cent. in sense ‘innate character’; late 14th cent. in sense ‘the native population of a town’; late 15th cent. denoting a division of the university of Paris; 1505 in the passage translated in quot. 15231 at sense 7b in sense ‘native population of a town’; 1668 in French in sense ‘species of animal’; 1765 in sense ‘territorial division of the Maltese Order’) < classical Latin ntin-, nti birth, race, nation, class of person, in post-classical Latin also (in plural, nationes) denoting gentiles (Vetus Latina: the Vulgate has gens), (in singular) the animal kingdom (Vulgate), Irish clan (1336, 1566 in Irish sources), division of university students (mid 13th cent. with reference to the university of Paris, a1350 with reference to the university of Oxford, 15th cent. with reference to Scottish universities) < nt-, past participial stem of nsc to be born (see NASCENT adj.) + -i -ION suffix1.
Compare Italian nazione (1294), Spanish nación (1444), Portuguese naçao (1691; 14th cent. in forms naçõ, nasçião), and also German Nation (14th cent.).]

I. A people or group of peoples; a political state.

1. a. A large aggregate of communities and individuals united by factors such as common descent, language, culture, history, or occupation of the same territory, so as to form a distinct people. Now also: such a people forming a political state; a political state. (In early use also in pl.: a country.)

OED

nation

Ambiguity in usage
In the strict sense, terms such as "nation," "ethnos," and "people" (as in "the Danish people") denote a group of human beings. The concepts of nation and nationality have much in common with ethnic group and ethnicity, but have a more political connotation, since they imply the possibility of a nation-state.

Country denominates a geographical territory,[3] whereas state expresses a legitimized administrative and decision-making institution. Confusingly, the terms national and international are used as technical terms applying to states. International law, for instance, applies to relations between states, and occasionally between states on the one side, and individuals or legal persons on the other. Likewise, the United Nations represents selected sovereign states, while nations that are free, per se, are not admitted as members.

http://en.wikipedia.org/wiki/Nation

A Sovereign state is a state with a defined territory on which it exercises internal and external sovereignty, a permanent population, a government, independence from other states and powers, and the capacity to enter into relations with other sovereign states.It is also normally understood to be a state which is not dependent on, or subject to any other power or state. While in abstract terms a sovereign state can exist without being recognised by other sovereign states, unrecognised states will often find it hard to exercise full treaty-making powers and engage in diplomatic relations with other sovereign states.