I heard the older Audi tt 2001 2003 lacks in performance.?

Is this true and what year did the engine change?

I think you mean the shift in mid 2003 when Audi went from a non VVT to a VVT engine in its 225 TT great car by the way my mom has one 2002 non VVT, and this modification didn't change the car's performance numbers much but it did keep the car more up to date on technology. The VVT engine is better for tuning than its non VVT counterpart.
VVT means variable valve timing, a way of adjusting the intake valve timing, which optimizes the engine's performance. I do not think you could tell the difference unless you added a stage three turbo system or something alike.

That's not exactly true.

Audi offered a 225hp variant of the TT back then you may be able to recognize it by the twin exhaust pipes, the lesser powered variant had a single pipe . It was plenty fast enough, zero 60mph was just under 6s IIRC.

it depends on what you mean when you say performance david is right the 225 is decent but the 225 isn't a drag car and its not supposed to be it has great handeling caricteristics and will be fast through the twisties the drving dynamics of this car are right up there with the Porche boxters and I think its better looking the new engines are available in the 2008 tt's which are on the dealer lots now. you may be able to get a 200hp 2.0 turbo which is good engine for this car or you may be able to choose the pricier 250HP v6 think about that the 2.0t engine can be tuned to meet or surpass the V6's 250hp with less added weight on the nose. I could choose a tuned 2.0T

but its better than a shopping cart