A laser that uses a p-n junction diode made from a direct-gap semiconductor material such as gallium arsenide, GaAs. When a p-n junction is operated in forward bias, majority carriers are injected across the junction and appear as excess minority carriers on the other side of the junction. In normal p-n junction operation these excess carriers would recombine with the majority carriers, and constitute the current flow across the junction. In a direct-gap semiconductor this recombination process can be radiative: the band-gap energy E_g that is released during recombination is given up as light, which has a wavelength λ = hc/E_g and is thus monochromatic (h is the Planck constant and c the speed of light).

Stimulated emission of coherent radiation is arranged by cutting the semiconductor laser die so that the two end faces are parallel and reflective, and the radiated photons pass through the active region or optical cavity of the laser, causing further stimulated emission of photons. The light in the optical cavity is confined by the active area of the p-n junction contacts.

In a heterostructure laser, greater optical confinement is obtained by surrounding the active p-n junction region by semiconductor material of a slightly different dielectric constant and hence refractive index. This causes internal reflections of the photons at the interface between the active region and this confining layer, resulting in a higher photon density in the light beam and hence a higher intensity of light. An example of a heterostructure laser would use a GaAs p-n junction active region, sandwiched between layers of lattice-matched AlGaAs, which has a slightly higher dielectric constant. Variations on this theme can include further heterostructure layers to confine the laser active region and the optical cavity independently, a device known as a separate confinement heterostructure (SCH) laser.

In the above examples, reflective facets are used to provide the optical feedback necessary for stimulated emission to occur. In a distributed feedback (DFB) laser, the feedback is generated by corrugating the interface between the active and confining layers with a specific periodicity; this causes the emitted light to be scattered back into the optical cavity to interfere constructively with the light reflecting from the two facets. The optical feedback and hence the laser output is thereby increased.