How React works? How Virtual-DOM works in React?

React creates a virtual DOM. When state changes in a component it firstly runs a “diffing” algorithm, which identifies what has changed in the virtual DOM. The second step is reconciliation, where it updates the DOM with the results of diff.

The HTML DOM is always tree-structured — which is allowed by the structure of HTML document. The DOM trees are huge nowadays because of large apps. Since we are more and more pushed towards dynamic web apps (Single Page Applications — SPAs), we need to modify the DOM tree incessantly and a lot. And this is a real performance and development pain.
The Virtual DOM is an abstraction of the HTML DOM. It is lightweight and detached from the browser-specific implementation details. It is not invented by React but it uses it and provides it for free. ReactElements lives in the virtual DOM. They make the basic nodes here. Once we defined the elements, ReactElements can be render into the "real" DOM.
Whenever a ReactComponent is changing the state, diff algorithm in React runs and identifies what has changed. And then it updates the DOM with the results of diff. The point is - it’s done faster than it would be in the regular DOM.