The Displace function shifts the texture's rows and columns according to a specified outline.

This outline is given by the Transformation type. When the texture's rows get shifted, a pixel's vertical coordinate is used as Input value, the displacement amplitude is controlled by the Output of this transformation. The same applies to the displacement of the columns, with the difference that a pixel's horizontal coordinate defines the function Input there.

Image 3 for example shows the Quantize transformation type, which results in a stairs-like shifting pattern.

Whether the shifting should affect the texture horizontally, vertically or in both direction, can be defined by the Dimensions controls.
The Tiling values regulate the repetitions of the transformation pattern along the rows and columns.
Relative to the texture's width and height, the amplitude of the displacement can be manipulated with the Amplify value.