To give you an example: "This is my book. It is interesting"
"this" = to establish WHICH book we are talking about (maybe I am pointing to the book, or holding it in my hand... it is near me)
"it" = instead of repeating "my book" ("This is my book. My book is interesting".)
Each time you say "this", you are introducing something new.
e.g. "This is Sarah's book, this is Tom's book, this is my book..." Each time a different book.
In this example: "This is my book. This is interesting."
It sounds like the interesting thing is something else (not the book we just mentioned)
There are some examples where you can use both "this is" and "it is", with the same meaning.
Example: Tom: "Is this your book?" Sarah: "Yes. It is my book"
or, Tom: "Is this your book?" Sarah: "Yes. This is my book"
Sarah can say "it is my book" (because Tom already identified which book) or Sarah can say "this is my book" (because it is the first time Sarah says it, and maybe she wants us to be really sure).
Note: "this" = something nearby, "that" = something further away.
This is a nice video I found:
It is helpful!