NMOS transistors can operate with negative Vds, as their channel is bidirectional and can conduct in both directions if Vgs is maintained. The drain current expression remains valid for Vds < 0, but the presence of a parasitic body diode complicates operation. This diode, which has its anode connected to the source and cathode to the drain, prevents conduction until the drain voltage is lower than the source voltage. As long as the diode is off (Vds > -0.6V), the drain and source can be swapped without issue. Understanding these characteristics is essential for effective NMOS usage in circuit design.