Terraforming is the slow process of altering the environmental characteristics of a planet. This changes weather patterns, stabilizes extreme temperature fluctuations, and adjusts the abundance of surface water. Terraforming will only work on planets that have hospitable environments already. You can terraform a planet several times, but each application has an increased production cost.
The Gaia Transformation introduces genetically engineered microorganisms into a world to create an environment perfectly suited to both plant and animal growth. The transformation can only be applied to Terran environments turning them into Gaia-class worlds.