What is a diode in a generator?

Diodes work by allowing the electric current to flow easily in one direction but restrict its flow in the other. A diode is know as 'forward biased' then it is allowing the current to flow through the circuit, if it is stopping the current flowing through the circuit then it is 'reverse biased'.

What does a diode do in an alternator?

In an brush-less AC alternator, the diodes rectify the AC current that is induced in the exciter rotor by the exciter stator to DC.  This happens as diodes only allow flow in one direction, therefore as AC is current that flows in both directions, a diode will stop one of the flows from the AC to make it a DC.

This DC current is then fed through the main rotor to induce a current in the main stator.

It is necessary that the flow is DC as the magnetic field in the alternator of a generator rely on the flow to be a DC.

The diodes in an alternator are located in the AVR. There are the same amount of forward biased and reverse biased diodes so that the alternator can make the most of both directions of the AC. This means that all of the AC power can be used to generate electricity instead of just 50 %.