Iśvara comes from the root Isha- ‘to rule’ ‘ईश्-शासने’। The one who governs. Bhagavān is a word which is a गुण वाचक । Guṇa vāchaka means, those words which indicate the inherent qualities of the one it is used for. It is derived as भग + वान । All Sanskrit words have a root base from which derivations are formed as per the intention of the usage. In the word ‘Bhagavān‘ the root is ‘bhaga‘ and it has the meanings of six qualities. Bhaga भग – ऐश्वर्य aiśvarya, वीर्य vīrya, यश yaśa, श्री śrī, वैराग्य vairāgya एवं and मोक्ष mokṣa freedom. ऐश्वर्य aiśvarya means majesty, Lordliness. वीर्य vīrya means strength, यश yaśa means fame, श्री śrī means wealth, prosperity, वैराग्य vairāgya means detachment and मोक्ष mokṣa means absolute freedom. These are mentioned in various Purāṇas, with a slight change in the list of the six. This specific list mentioned above comes in the Viṣṇu Purāṇa and has been quoted by Śri Ādi Śaṅkarācharya, in the Bhagavad Gītā, Ch4, Vs 37 as –
“ऐश्वर्यस्य समग्रस्य वीर्यस्य यशसः श्रीयः । वैराग्यस्याथ मोक्षस्य षण्णां भग इतीरणा ।।(विष्णुपु. ६।५।७४)
Aiśvaryasya samagrasya vīryasya yaśsaḥ śrīyaḥ . Vairagyasyātha mokṣasya ṣaṇṇām bhaga itīraṇā . (Viṣṇu Purāṇa 6.5.74)
The -वान्, vān suffix is used to denote the ‘possessor of’; so Bhagavān means the one who possesses the above mentioned qualities inherently, in wholeness. Like in the example of धनवान dhanavān means the one who possesses wealth in abundance. Buddhimān means one full of Buddhi – discerning thinking.
Idea being, all the qualities which we perceive as wonderful, extraordinary, or even ultimate ends, the one who has them in full measure, developed fully, and the qualities are there constantly, steadily and not sporadically, such a one is called a Bhagavān.
Iśvara means Bhagavān – with such a definition. Iśvara who is Bhagavān.
If there are two words, Iśvara and Bhagavān can they not mean the two are different?
The difference is this only. Iśvara is used as a noun. And Bhagavān is used as an adjective. Thus when Iśvara has been given a name like Brahmā -the originator; Viṣṇu – the sustainer, or Śiva the destroyer, he is qualified as Bhagavān Viṣṇu etc. which in understanding becomes the Iśvara with all the complete qualties himself is now The Viṣṇu etc.
Difference of usage between Bhagavān and Devatā? None. Since Bhagavān is an adjective, even Devatās are called Bhagavān. In fact, due to the meaning of Bhagavān, it gets used even for someone whom we look upon as great. We do address them in Hindi as ‘Hey Bhagavan!’ हे भगवन्!
Thus, we do see that in the translations of the Vedic thought in English, Bhagavān is also God, Iśvara is also God, Devatā is also God. But in the Vedic thought they are all distinct. This has been one of the major sources of confusion among the seekers of mokṣa born and brought up in the era – “independent India.”
Vedās talk about kārmā – the realms of Vedic actions, upāsanā -the realms of worship and meditations, and jñana – the realm of knowledge of oneself, ātmajñana. This is for the sake of man alone. And not for Iśvara or God. But Iśvara and Devatās are important for those ends to be achieved respectively for which Karma, Upāsana and Jñana are the means, sādhanās.