Simplified operation:

Figure: Simple circuit to show the labels of a bipolar transistor.

The essential value of a transistor comes from its capability to make use of a small signal applied among the one pair of its terminals to control a much larger signal at other pair of terminals. This property is termed as gain. A transistor can control the output of it in proportion to the input signal; i.e., it can work as an amplifier. On the other hand, the transistor can be employed to turn current on or off in a circuit like an electrically controlled switch, in which the amount of current is ascertained by other circuit elements.

The two sorts of transistors have little differences in how they are employed in a circuit. A bipolar transistor comprises terminals labeled base, collector, and emitter. A small current at the base terminal (i.e., flowing from the base to the emitter) can control or switch a much larger current among the collector and emitter terminals. For a field-effect transistor, the terminals are entitled as gate, source, and drain, and a voltage at the gate could control a current among the source and drain.

The figure presents a common bipolar transistor in a circuit. Charge will flow among the emitter and collector terminals depending upon the current in the base. As internally the base and emitter connections behave such as a semiconductor diode, a voltage drop develops among the base and emitter while the base current exists. The amount of this voltage depends upon the material the transistor is made from, and is considered to as V_BE.