Where the grooves of the two pieces of polarized glass intersect is a pixel. By blocking the light from passing through the top piece of glass, it creates an area that is darker than its surrounding. This gives the appearance of pixels being turned on or off.
In order to block the light from passing though, the orientation of the liquid crystal has to be changed. To do this, an electric charge is needed. Without an electric charge, the liquid crystal is twisted which changes the angle of the light to match the angle of the top polarized glass. This allows light to pass through.
When an electric charge is applied, the liquid crystal untwists leaving the angle of the light unchanged. This causes the light to be blocked by the top perpendicular piece of polarized glass. The controllers on the display will determine which pixels turn on and off. These controllers are programmed to translate user data into predefined fonts or turn on the appropriately addressed pixels.