pretty much yes...
basically a server will wait for a connection, when a client estabilishes a connection it will send some information.
For your MMORPG that will be something like a variable to specify what charector you are, and the action that you wish to take...
the server would already know where you are on the map, your name friends what equipment you have etc. and would respond to the command accordingly...
example.
client makes the connection and sends your account name + encrypted password for verification, + a command (list inventory).
the server recieves this string.
name=Dnsgm,password=xyz,command=listinventory
the server recieves this, looks up your account name and encrypted password against the information in the database, once it knows that the account is you, it sends something like this.
inventory=map5,bronzedagger1,lantern2
your client recieves that information and then displays some pictures...
or course you could make the game a little more complicated and extensible by having the server send a lot more complicated information...
eg,
inventory=shield1-protection=2-attack=0,sword4-protection=1-attack=5
etc...