Liquids are used in hydraulic machines due to their incompressibility and stability in transmitting pressure effectively.
Liquids are preferred over gases as the 'fluid' in hydraulic machines because liquids are incompressible, while gases are compressible. When a force is applied in a hydraulic system, it must be transmitted effectively without being significantly reduced by compression, which is why liquids, with their resistance to compression, are ideal for this purpose.
Additionally, liquids have definite volumes and do not change shape easily, making them more suitable for the consistent transmission of pressure in hydraulic systems. Gases, on the other hand, have variable volumes and can easily change shape, making them unsuitable for the stable operation of hydraulic machinery.