Blood Oxygen Level Dependent (BOLD) variability reflects meaningful brain activity, yet its structural and biological correlates during early development remain unknown. Using longitudinal resting-state fMRI and multi-shell diffusion imaging acquired longitudinally in 54 very preterm infants (at 33-weeks' gestational age and term-equivalent-age) and 24 full-term newborns, we investigated how BOLD variability evolves in very preterm infants, its relationship with cortical microstructure and gene expression, using the BrainSpan dataset, and how it differs from full-term newborns at term-equivalent age. During preterm development, BOLD variability increased in primary sensory-sensorimotor and proto-Default-Mode-Network regions, accompanied by decreases in cortical diffusivity. Gene expression analysis revealed concurrent upregulation of genes mediating gliogenesis and neuronal ensheathment. At term-equivalent age, very preterm infants showed decreased BOLD variability and increased cortical diffusivity, compared to full-term newborns. In this work, we show that BOLD variability reflects cortical microstructural maturation, mediated by upregulation of gliogenesis and neuronal ensheathment. Interruption of these processes by preterm birth identifies putative mechanisms of preterm brain injury.