Yes, FEDERATION is a Scrabble word!

Letter values in Scrabble US: F 4, E 1, D 2, E 1, R 1, A 1, T 1, I 1, O 1, N 1.

Is it a valid word?

FEDERATION is a valid word in the official Scrabble dictionary (US), the UK Scrabble Dictionary and Words with Friends (ENABLE).

an organization formed by merging several groups or parties
a union of political organizations
the act of constituting a political unity out of a number of separate states or colonies or provinces so that each member retains the management of its internal affairs