set(VAR value) sets a variable in CMake. Access it with ${VAR}. Variables have scope: local (in current file or directory), parent scope (propagate up to including CMakeLists.txt), or cache (persistent across runs, visible in the CMake GUI).

Setting and using variables:

set(SOURCES main.cpp utils.cpp)
add_executable(app ${SOURCES})
 
set(VERSION 1.2.3)
message(STATUS "Building version ${VERSION}")

Variable scope:

set(LOCAL_VAR "value")              # local: only in current CMakeLists.txt
set(PARENT_VAR "value" PARENT_SCOPE) # parent: visible to including file
set(CACHE_VAR "value" CACHE STRING "Description")  # cache: persistent

Local variables don't escape their file. If a subdirectory sets a local variable, it doesn't affect the parent. Use PARENT_SCOPE to propagate values upward.

Cache variables persist across cmake runs and appear in the CMake GUI or via cmake -DVAR=value:

set(MY_OPTION OFF CACHE BOOL "Enable feature X")
if(MY_OPTION)
  # ... enable feature
endif()

Built-in variables (read-only, set by CMake):

CMAKE_BUILD_TYPE        # "Debug", "Release", "RelWithDebInfo"
CMAKE_CXX_COMPILER      # path to C++ compiler
CMAKE_INSTALL_PREFIX    # root directory for installation
CMAKE_SOURCE_DIR        # top-level CMakeLists.txt directory
CMAKE_BINARY_DIR        # build tree directory
CMAKE_CURRENT_SOURCE_DIR  # current CMakeLists.txt directory
CMAKE_CURRENT_BINARY_DIR  # current build directory
PROJECT_NAME            # project name from project()

Pass variables from the command line:

cmake -DCMAKE_BUILD_TYPE=Release ..
cmake -DMY_OPTION=ON -DVERSION=2.0 ..

Use variables to avoid repetition, configure builds conditionally, and parameterize paths. They're the primary way to make CMake flexible across different environments and user preferences.