The victor waits for a sign from the crowd. If the losing gladiator has put up a good fight, the crowd might choose to spare his life and the vanquished gladiator will live to fight another day. But if the crowd is dissatisfied with the losing fighter as was usually the case its dissatisfaction meant slaughter.
Yes, in ancient Rome, gladiators could be awarded their freedom after winning a certain number of fights or through other means, such as good behavior or being granted freedom by their owner.