Understanding MOSFET logic gates involves recognizing the source and drain terminals, which can be identified by their voltage potentials. For n-channel MOSFETs, the source is at a lower potential, typically connected to ground, while for p-channel MOSFETs, the source is at a higher potential, often connected to VDD. The direction of the arrow in symbol diagrams indicates the type of MOSFET, but it is not essential for determining the source and drain; this can be inferred from the voltage levels. In CMOS inverters, the NMOS conducts when the gate voltage exceeds the source voltage, while the PMOS conducts when the gate voltage is below the source voltage. Overall, MOSFETs are widely used in digital circuits for logic gate implementation, contrary to the misconception that they are solely for power handling.