Lights are a major feature of DCC, just as they're a dramatic and eye-searing part of the modern railway scene. If you've any doubt as to their current prominence, just click on the above photo and take a look at the train held at the signal in the distance. While the loco is barely recognisable as a Class 67, the lights are unmissable - definitely a trademark feature of the modern era that can't be overlooked if you want to begin to capture the look of the real railway.
In earlier decades of the D&E era lights weren't quite as prominent. These Class 20s rumbling through a gloomy Derby station in 1987 are displaying one of the more subtle configurations typical of the time.
Keep an eye on the prototype you're modelling, the real thing tends to have a mix of lighting types these days, especially as more and more stock is fitted with LEDs instead of conventional bulbs. The Class 175 DMU in this photo has both 'golden white' and 'blue white' lights - easily replicated in miniature by using the right types of LED.
This Class 57 shows the LED cluster on the left, contrasting with the larger, more traditional headlight on the right.
Although miniature bulbs have been extensively used in model railways over the years, the natural choice these days is the humble LED, a cooler-running and more reliable alternative. For some while now I've standardised on the Maplin 3mm white LEDs (product code GV65V) for headlights, used in conjunction with 680 ohm resistors. These white LEDs actually have a slight bluish tinge to them, which may not suit your prototype, and are often referred to as 'blue white' LEDs. More recently 'golden white' LEDs have become more readily available and look just like real bulbs when illuminated.
With the four main power wires of a typical four function decoder tucked out of the way, we can concentrate on the five function wires - most commonly used for lighting. There are five wires for four functions because the blue lead is a common connection, used by all functions. The white, yellow, green and purple wires correspond to the four individual functions and are used as and when required.
The core principle of lighting under DCC is that the blue wire (actually called the common positive) is connected to a resistor which is in turn connected to the 'anode' (postive side) of the LED. The other terminal of the LED, (the 'cathode' or negative side,) is then connected to the function wire of your choice to complete the circuit. In this photo the white wire has been used, which is the first function and most often used for headlights. Pressing the matching function button on your DCC controller will switch this function (and hence the light) on and off.