Acid-base indicators are weak acids or bases themselves which establish an equilibrium between their molecular and ionic forms. The molecular form has a different colour than the ionic form. Changes in the pH cause a shift in the equilibrium which favours one species over the other. For example if we look at phenolphthalein indicator:
                HPh         +      B <-------->       HB      +     Ph-
             colourless          base                  conjugate       magenta
        phenolphthalein                                   acid
Test your understanding of indicator behaviour: The acid colour of a certain indictor, HIn, is yellow and the basic colour is blue. When this indicator is added to a certain acid HB, the solution turns yellow. The equation for the reaction may be written as:
HB + In  <--------->  HIn + B-

Which is the stronger acid, HB or HIn?
Take a look at the Indicator Table in the Databook.
Methyl Orange is red in a pH of 3.2 or less and yellow in a solution of 4.4 or greater. The transition colour of orange is seen between these two points.
At the transition point [HIn]=[In-]. that is, the concentration of the red-coloured species is equal to that of the yellow-coloured species so that the solution appears orange.
Thus methyl orange can be used for a titration reaction in which the pH of the solution at the stoichiometric point is between 3.2 and 4.4. The Ka for methyl orange at 25oC is 4.0 x 10-4. Thus ideally, the solution at the stoichiometric point should have a [H3O+] = 4.0 x 10-4 mol/L and a pH of 3.4.