A transformer is a device used to change AC voltage. It can increase or decrease the voltage depending on the required scenario. For example a microwave will use a higher voltage than the supply voltage. It usually steps up the voltage to around 1kV - 2kV.
A transformer uses electromagnetic induction to transfer voltage. This works by having a ferrous metal, usually iron, as a core with wires coiled around opposing sides. The amount of coils that are spun will affect how the voltage is transferred from the primary voltage to the secondary voltage.
So for example, if the input voltage is 240 V with 4 coils and the output side has 8 coils the output voltage will be doubled. So we will get an output voltage of 480 V. If the coils are halved on the output side then we will get 120 V.
The core is actually constructed using segments of laminated silicon steel. Usually laminated with a varnish.