Eric

Can't speak for PS1, but on the GameCube you would get to some midpoint of the game where a screen telling you to swap the disk while leaving the console on would come up. Half of the areas/levels were on one disk, half were on another. Obviously you couldn't backtrack disk 1 content with disk 2 inserted. I'd assume it was basically the same on PS1.

Keep in mind these were the days when consoles had external memory cards used to store your game progress, so that was how they kept your progress between disks.