How does a transistor work as a switch explain with diagram?

In brief and in the most general terms, a transistor is a 3-terminal semiconductor device capable of changing its resistance in a "controlled" way. It is like the valve (the hose bib) that you open to turn on the water to your hose. The valve allows you to apply a little energy (from your hand) to control lots of energy (the water pressure). That's amplification. Let's peek in on this and make some simple comparisons. A transistor has an emitter, a collector and a base. The emitter and collector could be considered "input and output" terminals in the most basic sense. As for the base, it is the "control terminal" just like the handle on the faucet. By applying a small voltage to the base to "turn on" the device, we can get current to begin flowing. First a little, and then, by turning it on more, a lot. Eventually the device will be "all the way on" and will be allowing maximum current to flow through it. The opposite will be true when we turn the device off. That's it. Oh, but let's take a moment to look at the implications, shall we? Imagine turning on the water really, really fast. Like almost instantly on. Then off the same way. By turning the transistor on and off "instantly" and looking at the result, we'd get "ons" and "offs" from it. That's 1's and 0's there, and it's binary. That's how we can make a digital signal. And this process is exactly at the heart of how the microprocessor in all digital computers works. You probably saw that coming. Let's look at one other thing. You're familiar with sound, which is mechanical energy. It's like a vibrating string on a guitar or the membrane ("skin") on a drum, just to cite a pair of examples. That movement creates harmonic or oscillating motion and the sound. If we want to create the electrical equivalent, we have to open and close that water valve as quickly as the frequency of the vibrations. That's not really possible with the valve, but with the transistor, we can apply a changing voltage to the base as fast as any "regular" mechanical vibration. If a string vibrates at 1000 cycles per second (1000 Hertz), we can change the voltage to the base at that rate. Let's slow the action down. Note that we start turning on the transistor, then we turn it on a bit more, then a bit more. At some point we've reached a "peak" and then we start turning it off, and off a bit more and off a bit more until it's off. The rateat which we do this corresponds to the frequency of the signal being amplified by the transistor. And how far we actually turn the transistor on before turning it back off corresponds to the amplitude of the signal we are working with. The transistor has largely replaced the vacuum tube, which was originally called an electronic valve. Having wandered around in this discussion, you may be able to see why the terminology (which is a bit "old school" now) can still be fairly applied - even to the transistor.