Predynastic Egypt is generally divided into "cultures" or "cultural periods" which are named after the geographical location where that type of Egyptian settlement was first located. Therefore you have something like the Naqada culture, based in Upper Egypt around the modern town of Naqada, existing from around 4400-3000 BC. At the same time, in other places in Upper Egypt, you have the Badarian culture from around 4400 to 4000 BC and the Amratian culture about 120 km south of the Badarians from 4000 to 3500 BC. Each of these "cultures" has a specific set of material culture that defines it, and a specific way of life that depends on the environment they live in.

The Naqada period is probably the one you are most interested in, as Naqada III (the third and latest part of the period) is understood as the period when Egypt was unified.

There are two main viewpoints about exactly what was happening in this period.

• Naqada culture was a single political united state the whole time that grew to dominate the region (supported by Werner Kaiser 1990)
• Naqada culture was based on a succession of different city-states where a ruling elite was located, based on different locations of elite tombs. This is championed by Toby Wilkinson (2000).

In the North at this time, the Maadi culture was predominant, until the Naqada culture overtook it in the middle of the Naqada II period. It is important to remember that these "cultures" are not the same as political entities, but are an amalgamation of distinctive continuous sociocultural phenomena, such as a pottery assemblage, religious symbology, social organization, etc. This all took place before writing, so we cannot see how they divided themselves, only how they differentiated themselves in the material culture. And it appears that in the Naqada III period, the Naqada culture became predominant throughout Egypt, displacing other artifact assemblages.

Upper Egypt was the main mover and shaker through the Predynastic Period. Upper Egypt was the place to begin major class differentiation, evidenced in highly differentiated burials, indicating an increasingly hierarchical society (according to Shaw, 2000, p. 57). The northern Maadi culture had a link to international trade (being closer to other areas of the world and with access to trade routes), which was probably why Upper Egypt and the Naqada culture sought to incorporate it.

Competing elite cemetaries within the expanding Naqada culture indicates that multiple city-states may have been competing for resources and authority from the Naqada II through the Naqada III periods.

"indigenous" Upper Egyptian culture (including the Maadi) became completely replaced by the Naqada culture by the end of Naqada II (~3200 BC). (Shaw 2000 p. 59), though as I stated before this does not necessarily mean that Egypt was unified at this time, though some scholars have argued that.

In short, predynastic Egypt is defined by specific material culture groups, which competed and displaced each other until the Naqada II culture of Upper Egypt took over the whole of Egypt. The main differences in differentiation are material culture differences, such as the Maadi pottery tending toward being darker, and the Naqada tending toward being redder or lighter, with a black top. The Maadi had better trade routes until the Naqada culture displaced them, and therefore more imported stuff.

The Oxford History of Ancient Egypt by Ian Shaw (2000) is a fantastic overview of Egyptian history, and includes a pretty solid discussion of the predynastic and protodynastic periods of Egypt. I recommend checking it out. You can preview it on Google Books here

This website at the University College London gives an outline of the various cultures and periods and tells you a bit about how they are differentiated in terms of material culture. I encourage you to click on the links for each predynastic culture to see and read about the materials that differentiate them from the others.

If you have any more questions, I would be happy to try to answer them, I hope this answer helps.

EDIT: proofreading