To identify the type of transistor (PNP or NPN) from a circuit board, check the numbers on the transistor, as they can often be looked up online for more information. Transistors can be tested using the diode function of a digital multimeter; if the "diodes" are joined at the anodes, it indicates an NPN type, while joining at the cathodes indicates a PNP type. This testing can be performed even when the transistor is still on the board, although other components may complicate results. For more accurate testing, removing the transistor allows for an "hfe" gain test with most digital multimeters to determine pin connections and functionality. Understanding these methods is essential for effective transistor identification and troubleshooting.