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The Transport Layer is crucial in the OSI (Open Systems Interconnection) model as it is responsible for providing end-to-end communication services for applications. It functions by managing the flow of data across networks and ensuring complete data transfer. Protocols like TCP (Transmission Control Protocol) and UDP (User Datagram Protocol) operate at this layer, each offering different methods for data transmission.

TCP is a connection-oriented protocol, which means it establishes a reliable connection before data is sent, ensuring that packets are delivered in order and without loss. In contrast, UDP is a connectionless protocol that allows for faster data transmission, with less overhead, but does not guarantee the delivery of packets or their order. SPX (Sequenced Packet Exchange) is another example of a protocol that operates at the Transport Layer, particularly in certain networking environments.

The significance of the Transport Layer lies in its role in managing how data is segmented for transmission, controlling the data flow of packets, and facilitating error recovery and detection. This supports the higher layers that depend on reliable data transport, making protocols functioning at this layer vital for the overall communication process in networking.