In this sense, they are similar to Rebellions, except that it only takes place in the faction's home region.
Revolutions occur when a class in the home region of a faction has negative public order (signifying dissatisfaction with the current government) for three consecutive turns, spawning a rebel army, which will try to take the region capital. In Empire: Total War, revolutions are rebellion against a government. Revolutions are defined as an action usually undertaken by people who desire drastic change. A revolution is an event in Empire: Total War.