A light valve capable of operating in an 'off' state for reflecting lignt and in an 'on' state for diffracting and reflecting light. The valve includes a semiconductor substrate having a plurality of electrodes formed therein for receiving voltages and for generating an electric field in response to the received voltages. A layer of transparent deformable dielectric material is disposed on the reflective electrodes which deforms in response to the generated electric field. When the valve is in its 'on' state, the electric field causes deformities in the dielectric material which diffract incident light reflected off of the valve. In another embodiment, the dielectric material is placed on the reflective electrodes or on a transparent substrate having a transparent electrode formed thereon. The transparent substrate is then disposed in spaced relation from the semiconductor substrate containing the reflective electrodes.