To turn the LED on, simply touch the drain terminal and gate terminal at the SAME time.
To turn the LED off, touch the source terminal and gate terminal at the SAME time
The logic behind this project is the characteristics of the MOSFET:
For the LED to light up, the MOSFET must fully ON, which means Vds > Vgs – Vt. Since MOSFETs are voltage-controlled transistors, touching the drain and gate terminal at the same time will “short” them, therefore allowing the MOSFET to be fully ON.
On the other hand, touching the gate and source terminal will turn the MOSFET fully OFF, because it cannot satisfy the overdrive voltage (Vov) requirement (Vov = Vgs – Vt, Vgs = 0V).
If you have difficulties turning the circuit on and off, wetting your hands may help.