Hello Sivakanth,
SFP are optical transceivers that can be inserted in appropriate bays to connect optical fiber pairs.
They are named small format pluggable transceivers to distinguish them from first generation GBIC transceivers.
Externally they have two small slots for the optical fiber with one TX and one RX side. On the back there is an electrical combo with some pins to get power and the signal to be sent and received,.
The optical connectors can be LC or LC2 type. Optical fiber can be multi mode or single mode depending on the characteristics of the optoelectronic devices included.
The transmitter is a laser diode based on semiconductors alleys and the receiver is a photodiode again based on semiconductor alleys.
The laser emits light based on the current that flows through it and this allows for light modulation (TX side)
The photodiode generates an electrical current depending on the optical power that hits its surface (RX side)
The SFP include all the electronic for powering the optoelecronic devices and also allows for on line insertion and removal.
see
http://www.cisco.com/en/US/docs/routers/7200/install_and_upgrade/gbic_sfp_modules_install/5067g.html
http://en.wikipedia.org/wiki/Small_form-factor_pluggable_transceiver
Hope to help
Giuseppe
