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The word "inverter" was originally used because the output wave form produced by its circuits alternates between a positive and a negative voltage. This device "inverts" the polarity of the power source (typically, a battery or PV array), causing the current to flow in alternating directions through the load. Hence the term "alternating current".

If you've studied our article on transformers, you'll know that they're electromagnetic devices that change low-voltage AC to high-voltage AC, or vice-versa, using two coils of wire (called the primary and secondary) wound around a common iron core. In a mechanical inverter, either an electric motor or some other kind of automated switching mechanism flips the incoming direct current back and forth in the primary, simply by reversing the contacts, and that produces alternating current in the secondary—so it's not so very different from the imaginary inverter I sketched out above. The switching device works a bit like the one in an electric doorbell. When the power is connected, it magnetizes the switch, pulling it open and switching it off very briefly. A spring pulls the switch back into position, turning it on again and repeating the process—over and over again.