FormElement

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Drupal's Form API #states property allows to easily show or hide, enable or disable, require or collapse form fields based on values selected or entered in other fields on that form or anywhere else on the page.

Overview

Adding AJAX callback events to form fields allows to dynamically update fields and other markup, while users interact with the forms.

More general information about Drupal and Ajax can be found at Drupal Ajax API Guide and Drupal's Ajax API documentation (at api.drupal.org).

Some working examples can be found in the Examples for Developers modules, specifically in the AJAX Example submodule, see its Form folder.