s/frog/toad/g txtfile
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won't work inside a perl script. It works from the command line because "txtfile" is actually be handed to the mini-script created by using 'perl -i.bak -pe 's/frog/toad/g'. Use 'perl --help' to see what -i -p and -e mean. This sounds a lot like a homework assignment, but here is one solution:

#!/usr/bin/perl -w
use strict;

# this script will edit itself
ReplaceStuff($0,'word','taco');

sub ReplaceStuff{
  my ($file,$origword,$newword) = @_;
  local $^I="";        # set the backup tag to nothing
  local @ARGV = $file; # make a local @ARGV so we can use <>
  # go through each line and do the substitution
  while (<>) {
    s/$origword/$newword/g;
    print;             # print stuff out
  }
}
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