Broadly speaking, a grenade is just a small bomb designed for short-range use. The idea of a bomb is very simple: Combustible material is ignited to produce an explosion -- a rapid expansion of gases that produces strong outward pressure. The essential elements of a grenade, then, are combustible material and an ignition system.
There are all sorts of combustible materials used in grenades, and they generate a range of explosion types. Some explosions will spread fire, and others will just release a lot of smoke. Some produce little more than a loud noise and a flash of light. Some release toxic gases.
Ignition systems also vary, but they generally fall into one of two categories: time-delay igniters and impact igniters. The function of both systems is to set off the explosion after the grenade is a good distance away from the thrower. As you might expect, the igniter in an impact grenade is activated by the force of the grenade landing on the ground. With a time-delay grenade, the thrower sets off a fuze, a mechanism that ignites the grenade after a certain amount of time has passed (generally a few seconds).
One very simple impact grenade is a container filled with nitroglycerine or another material that combusts easily when jarred. In this case, the flammable liquid itself is the impact igniter. One simple but effective time-delay grenade is the Molotov cocktail, a bottle of flammable liquid with a rag sticking out of it. The rag acts as a crude fuze -- the thrower lights it and tosses the bottle. When the bottle smashes on impact, the flammable liquid flows out and is ignited by the burning rag.
The problem with both of these grenades is they can easily explode before the thrower gets rid of them. Proper grenades used by soldiers and police officers have safer, more sophisticated ignition systems, as we'll see in the following sections.