You are getting confused with transclude: true
, which would append the inner content.
replace: true
means that the content of the directive template will replace the element that the directive is declared on, in this case the <div myd1>
tag.
http://plnkr.co/edit/k9qSx15fhSZRMwgAIMP4?p=preview
For example without replace:true
<div myd1><span class="replaced" myd1="">directive template1</span></div>
and with replace:true
<span class="replaced" myd1="">directive template1</span>
As you can see in the latter example, the div tag is indeed replaced.