The system is considered a secondary radar system since it operates completely differently and independently of the primary radar system that tracks aircraft skin returns only, although the same CRT display is frequently used for both.
The system was initially intended to distinguish between enemy and friend but has evolved such that the term "IFF" commonly refers to all modes of operation, including civil and foreign aircraft use.
There are four major modes of operation currently in use by military aircraft plus one submode.
A cross-band beacon is used, which simply means that the interrogation pulses are at one frequency and the reply pulses are at a different frequency. 1030 MHz and 1090 MHz is a popular frequency pair used in the U.S.
The secondary radar transmits a series of selectable coded pulses. The aircraft transponder receives and decodes the interrogation pulses. If the interrogation code is correct, the aircraft transponder transmits a different series of coded pulses as a reply.
The advantage of the transponder is that the coded pulses "squawked" by the aircraft transponders after being interrogated might typically be transmitted at a 10 watt ERP, which is much stronger than the microwatt skin return to the primary radar. Input power levels may be on the order of several hundred watts.
The transponder antenna is low gain so that it can receive and reply to a radar from any direction.
An adjunct to the IFF beacon is the altitude encoding transponder known as mode C - all commercial and military aircraft have them, but a fair percentage of general aviation light aircraft do not because of cost. The number of transponder installations rises around many large metropolitan areas where they are required for safety (easier identification of aircraft radar tracks).
Air traffic control primary radars are similar to the two dimensional search radar (working in azimuth and range only) and cannot measure altitude.
The expanded display in the figure is typical of an air traffic control IFF response. The aircraft was told to squawk a four digit number such as "4732". The altitude encoded transponder provides the aircraft altitude readout to the ground controllers display along with the coded response identifying that particular aircraft.