Differentials

The differential has three jobs:

1. To transfer the drive from the drive shaft to the wheels

2. To act as the final gear reduction in the vehicle, slowing the rotational speed of the transmission one final time before it hits the wheels

3. To transmit the power to the wheels while allowing them to rotate at different speeds (This is the one that earned the differential its name.)

Car wheels spin at different speeds, especially when turning. Each wheel travels a different distance through the turn, and that the inside wheels travel a shorter distance than the outside wheels. Since speed is equal to the distance traveled divided by the time it takes to go that distance, the wheels that travel a shorter distance travel at a lower speed. Also the front wheels travel a different distance than the rear wheels.
 

For the non-driven wheels on your car -- the front wheels on a rear-wheel drive car, the back wheels on a front-wheel drive car -- this is not an issue. There is no connection between them, so they spin independently. But the driven wheels are linked together so that a single engine and transmission can turn both wheels. If your car did not have a differential, the wheels would have to be locked together, forced to spin at the same speed. This would make turning difficult and hard on your car: For the car to be able to turn, one tyre would have to slip. With modern tyres and concrete roads, a great deal of force is required to make a tire slip. That force would have to be transmitted through the axle from one wheel to another, putting a heavy strain on the axle components and gearbox.

http://www.howstuffworks.com/differential.htm

http://www.team-bhp.com/forum/attachments/4x4-vehicles/301364d1267847120-mpfi-gypsy-king-bought-mayapuri-differential-diagram.jpg