A major difference between them is that value-type variables store values, so specifying a value-type variable in a method call passes a copy of that variable's value to the method. Reference-type variables store references to objects, so specifying a reference-type variable as an argument passes the method a copy of the actual reference that refers to the object. Even though the reference itself is passed by value, the method can still use the reference it receives to interact with—and possibly modify—the original object. Similarly, when returning information from a method via a return statement, the method returns a copy of the value stored in a value-type variable or a copy of the reference stored in a reference-type variable. When a reference is returned, the calling method can use that reference to interact with the referenced object. So, in effect, objects are always passed by reference.
In c#, to pass a variable by reference so the called method can modify the variable's, C# provides keywords ref and out. Applying the ref keyword to a parameter declaration allows you to pass a variable to a method by reference—the called method will be able to modify the original variable in the caller. The ref keyword is used for variables that already have been initialized in the calling method. Normally, when a method call contains an uninitialized variable as an argument, the compiler generates an error. Preceding a parameter with keyword out creates an output parameter. This indicates to the compiler that the argument will be passed into the called method by reference and that the called method will assign a value to the original variable in the caller. If the method does not assign a value to the output parameter in every possible path of execution, the compiler generates an error. This also prevents the compiler from generating an error message for an uninitialized variable that is passed as an argument to a method. A method can return only one value to its caller via a return statement, but can return many values by specifying multiple output (ref and/or out) parameters.
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