SignalR enables real-time communication between a client and server through a persistent connection. It uses this connection to call methods on either end. To call a client method from the server, the server uses "Clients.Client(id).MethodName()". To call a server method from the client, the client uses "$.connection.hubName.Server.methodName()". SignalR handles the underlying transport without requiring knowledge of protocols, providing an easy API for bidirectional communication.