Is the word by a preposition?

Answer 1

It can be.

A preposition is a word, or group of words, that is used with a noun or pronoun to indicate a relationship to another thing. It can show place, proximity, direction, time etc.

e.g.

• Your dinner is in the oven.
• The cat sat on the mat.
• There was an awful noise last night, and it was after midnight too!
• I was told the news by a close friend.
• His dog is always by his side.
• The recession gets worse by the hour.

So the word 'by' is clearly a preposition.

Answer 2

Yes, "by" can function as a preposition when indicating the agent performing an action or showing the method or means of accomplishing something.