A washing machine is an example of an embedded system used in home automation. It contains sensors to detect water temperature and level, actuators like a motor and pump to agitate clothes and control water flow, and a control unit to process sensor data and control the actuators. The control unit also interfaces with the user through a control panel with buttons to set wash options and a display to show status. It runs a control algorithm to manage the whole washing process based on user inputs and sensor readings.