Digital holography is an imaging technique that has application in three dimensional imaging as well as phase contrast microscopy. In digital holography an interference pattern is recorded by a digital camera. The interference pattern is formed from a known reference eave and the light scattered from an object. The digital hologram is then input to a computer algorithm that simulates the back propagation of light from the camera plane to the image plane. In this paper we show how Phase Space Diagrams can be used to interpret and understand these systems.