How are symbols used to identify arguments in ruby methods

Symbols and hashes are values like any other, and can be passed like any other value type.

Recall that ActiveRecord models accept a hash as an argument; it ends up being similar to this (it's not this simple, but it's the same idea in the end):

class User
  attr_accessor :fname, :lname

  def initialize(args)
    @fname = args[:fname] if args[:fname]
    @lname = args[:lname] if args[:lname]
  end
end

u = User.new(:fname => 'Joe', :lname => 'Hacker')

This takes advantage of not having to put the hash in curly-brackets {} unless you need to disambiguate parameters (and there's a block parsing issue as well when you skip the parens).

Similarly:

class TestItOut
  attr_accessor :field_name, :validations

  def initialize(field_name, validations)
    @field_name = field_name
    @validations = validations
  end

  def show_validations
    puts "Validating field '#{field_name}' with:"
    validations.each do |type, args|
      puts "  validator '#{type}' with args '#{args}'"
    end
  end
end

t = TestItOut.new(:name, presence: true, length: { min: 2, max: 10 })
t.show_validations

This outputs:

Validating field 'name' with:
  validator 'presence' with args 'true'
  validator 'length' with args '{min: 2, max: 10}'

From there you can start to see how things like this work.

I thought I'd add an update for Ruby 2+ since this is the first result I found for 'symbols as arguments'.

Since Ruby 2.0.0 you can also use symbols when defining a method. When calling the method these symbols will then act almost the same as named optional parameters in other languages. See example below:

def variable_symbol_method(arg, arg_two: "two", arg_three: "three")
  [arg, arg_two, arg_three]
end

result = variable_symbol_method :custom_symbol, arg_three: "Modified symbol arg"

# result is now equal to:
[:custom_symbol, "two", "Modified symbol arg"]

As shown in the example, we omit arg_two: when calling the method and in the method body we can still access it as variable arg_two. Also note that the variable arg_three is indeed altered by the function call.