Shower diverter valves exist in any bathtub and shower combination, otherwise the water would only come out of the bathtub's spout or the shower head. Problems with the shower's diverter valve will lead to problems with the operation of the bathtub or the shower. How you repair the diverter depends on the type of diverter your faucet uses.
A shower's diverter changes the direction of the flow of water coming from the faucet. On most showers, the diverter has a small bar coming out of the top of the bath spout, which you pull up on to send the water to the shower head and push down on to send the water out of the spout.
Old Fashion Diverters
On older shower faucets, the diverter comes as a third handle, sitting in between the hot and cold shower control handles. Once the diverter stops working properly, leaking and not sending as much water to the shower head, you must repair it the same way you fix a leaking faucet. Shut off the water to the shower, remove the diverter's handle and then remove and replace the diverter's stem valve.
Many modern faucets place the diverter valve in the bathtub's spout in the form of a small handle or bar on the top of the spout. To direct the water to the shower head, you must pull up on the diverter. Pushing down on the diverter will send the flow of water back down to the bathtub's spout. When the diverter valve starts to leak or just stops working at all, you need to remove the old spout and install a new one, since the cost of replacing the diverter costs more than a new spout.
The new spout you install must have the diverter located in the same part of the spout. Before you can install the new spout, you have to remove the old spout. Some spouts are secured by a single screw on the underside of the spout, which you loosen with a small Allen wrench before you pull the spout off the water pipe. Other spouts simply screw onto the water pipe, so you must turn them counterclockwise to remove them from the pipe. If you cannot turn the spout by hand, use a pipe wrench. Wrap a hand towel around the spout before clamping the pipe wrench to it, if you plan to use the spout again, since the pipe wrench will ruin the finish. Install the new spout the same way you removed the old spout, just in reverse.