The video transcript explains the operation of a double interlock preaction system, a type of fire suppression system commonly used in refrigerated areas. This system requires both a fire detection system and an open sprinkler head to activate, ensuring that water only flows into the piping system when a fire is actually present. The transcript details the components of the system, including the Deluge valve, pneumatic actuator, and electric solenoid valve, and explains how they interact to release water upon detection of a fire. The video also covers the use of a pressure-operated relief valve to prevent the system from resetting prematurely and the functionality of a manual release for emergency situations.