Introduction:
The NameError exception is raised in Python when a variable name cannot be found. It occurs when the interpreter encounters an undefined variable name and cannot determine its value or reference. This error indicates that the variable has not been assigned any value or is not defined within the current scope.

Explanation:
Python is a dynamically typed language, which means that variables do not need to be explicitly declared before they are used. However, if a variable is referenced before it is assigned a value or defined, a NameError exception is raised.

When the interpreter encounters a variable name, it searches for its definition within the current scope. If the variable is not found, a NameError exception is raised. This can happen in various scenarios, such as:

1. Undefined variable: If a variable is referenced before it is assigned a value or defined, a NameError is raised. For example:
```
print(x) # NameError: name 'x' is not defined
```
In this case, the variable 'x' has not been assigned any value or defined before it is used, resulting in a NameError.

2. Out of scope variable: Variables have a specific scope within which they can be accessed. If a variable is referenced outside of its scope, a NameError is raised. For example:
```
def my_function():
print(x)

my_function() # NameError: name 'x' is not defined
```
In this example, the variable 'x' is defined within the scope of the 'my_function' function. When we try to access it outside of the function, a NameError is raised.

3. Mistyped variable name: If a variable name is misspelled or mistyped, the interpreter will not be able to find its definition and raise a NameError. For example:
```
message = "Hello, world!"
print(mesage) # NameError: name 'mesage' is not defined
```
In this case, the variable 'message' is misspelled as 'mesage', causing a NameError.

Conclusion:
In Python, the NameError exception is raised when a variable name cannot be found. This can occur when a variable is referenced before it is assigned a value or defined, when it is out of scope, or when it is misspelled or mistyped. It is important to ensure that all variables are properly assigned and defined within the appropriate scope to avoid NameError exceptions.