The terminal is under the control of the computer. The computer not only sends the terminal text to display on the screen but also sends the terminal commands which are acted on. These are Control Codes (bytes) and escape sequences. For example, the CR (carriage return) control code moves the cursor to the left hand edge of the screen. A certain escape sequence (several bytes where the first byte is the "escape" control code) can move the cursor to the location on the screen specified by parameters placed inside the escape sequence.
The first terminals had only a few such commands but modern terminals have hundreds of them. The appearance of the display may be changed for certain regions: such as bright, dim, underline, blink, and reverse video. A speaker in a terminal can "click" when any key is pressed or beep if a mistake has occurred. Function keys may be programmed for special meanings. Various fonts may exist. The display may be scrolled up or down. Specified parts of the screen may be erased. Various types of flow control may be used to stop the flow of data when bytes are being sent to the terminal faster than the terminal can handle them. There are many more as you will see from looking over an advanced terminal manual or from the Internet links Esc Sequence List