This device works on the “Archimede’s Principle”. It consists of a displacer rod suspended in the vessel. Height of this displacer should be at least from lowest level to be measured to the highest level to be measured.
As the fluid level rises, displacer displaces a volume of liquid equal to the cross section of the displacer multiplied by height of displacer immersed in fluid. This displaced fluid exerts a buoyancy force on the displacer which is measured by a force transducer at the top of the displacer. Transducer is linked to the transmitter. This force is directly proportional to the level of liquid inside the tank.
Check out these youtube videos to better understand it.