A transponder is an electronic device used to wirelessly receive and transmit electrical signals. Fittingly, its name is equally derived from the words "transmitter" and "responder".

Transponders were originally developed to be attached to objects which needed to be located, and are still used in this manner today. A transponder functions by receiving a signal, called an "interrogator" because it is effectively "asking" for information, then automatically conveying a radio wave at a predetermined frequency. In order to broadcast a signal on a different frequency than the one received, a frequency converter is built in. By receiving and transmitting on different frequencies, the interrogator and transponder signals can be detected simultaneously.

The first use of a transponder was onboard an aircraft during World War II, as part of the Identify Friend or Foe (IFF) system. By answering secret interrogation frequencies, pilots could indicate to radar operators that they were friendly aircraft.

Transponders are still common today in both military and commercial aviation. They receive a signal from the ground, and then automatically reply with an identification code for air traffic controllers, as well as altitude information. In aircraft applications, transponders are also configured to amplify the signal in order to make the plane more visible on radar.

Transponders are also used to measure distance by calculating the elapsed time between the sending of the interrogator signal and the receipt of the transponder's signal. For example, sonar transponders are used to mark underwater positions, calculate depth, and trace positions.

It may sound as if transponders are a technology that the average consumer never uses; even if that was once the case, it no longer is. The modern commuter probably has at least one transmitter in his car, probably mounted on the windshield or dashboard. These are for roads using electronic tolling systems which compute the amount of tolls to be paid and complete the transaction without requiring the driver to so much as lower their window. Some newer cars are also equipped with onboard transponders, which operators will use to locate their vehicle in the event of an emergency.

Cellular phones use a similar, albeit smaller, chip to send the phone's location if it used to call an emergency number. Even casual television viewing often involves the use of transponders. A network can uplink their ground-based satellites to communications satellites orbiting the Earth, send multiple channels of digitally compressed video and audio to a single transponder onboard it, and local stations can then pick up the program and re-broadcast it locally by aiming the appropriate ground-based dish.