Now days wireless communication is an essential replacement area and reflects enormous changes in day to day lives. Mobile communication, Digital Modulation is very much important for increasing the speed and capability of the wireless communication network. Now there is a growing technique called Li-Fi, which is wireless optical networking technology. The objective of the paper is describing the Li-Fi and its modulation techniques. Li-Fi uses Light Emitting Diodes (LED) for transmitting the data through illumination by changing the intensity which is quicker and offers security, higher bandwidth, efficiency, and avails. Li-Fi technology is replacement of radio frequency and also offers a high data rate, cost-effective. This will help to achieve a wireless communication with a better performance. It can apply to day to day activities and will adopt in devices in the future. In the future, Li-Fi can be several fields in traffic management, airlines, power plants and hazardous environment, underwater communications, giga speed technology, smart lighting, education system, disaster management and mobile connectivity. In the Digital modulation the message signal is in the digital type and, therefore, the carrier wave is in sinusoidal form. Li-FI have a unique modulation technique called single carrier techniques multi-carrier techniques and color modulation techniques. Modulation techniques are as On-Off keying, Pulse width Modulation, Pulse Amplitude Modulation, Orthogonal Frequency Division Modulation and alternative digital modulation technique are summarized. Simulation is the imitation of the operation of a real-world methodology. The act of simulating requires that a model be developed and simulates the operation of the system over time. This paper tends to analyze the single carrier modulation techniques such as BPSK, QAM, and also tends to provide information on digital modulation technique parameters as Bit Error Rate, and its Performance.