Derivation
Derivation is part of the system which allows new formations in the language, new lexicalizations.
Derivation is a selective process, with great limitations of occurrence, so that there must be lists and ad hoc specifications.
A derived form may be replaced by simpler form in the same syntactic construction without the construction being ungrammatical.
Derivation forms themes or stems from roots, which may then be inflected.
When we say that a given derivational morpheme or process is ‘productive’
we mean that it combines with a lot of other roots/stems; when we say that
it is ‘unproductive’ we mean that it is very restricted in the forms with
which it can combine.
Inflection
Inflection is part of obligatory system of the language, specifying what you MUST say.
Inflection refers to grammatical processes which apply to all members of a given class of forms, like all verbs mark person or all nouns mark number.
If the syntactic construction requires an inflected form then a simpler form may not occur without the construction being ungrammatical.
Inflection is added to stems, themes, or roots alike.
When we say ‘productive’ in the context of inflection we are talking
about allomorphs and referring to those that are added to new roots/stems
entering the language or that occur unless otherwise specified; when we
say ‘unproductive’ we are referring to allomorphs with restricted distribution.