Learn Portuguese (Portugal): Isto é o livro.

No. The word isto is an invariable pronoun, meaning it never changes form. It translates to "this thing" or "this". Even though livro is masculine, you use isto when pointing to an unidentified object. If you wanted to say "this book" instead of "this is the book", you would use the masculine word este (este livro).

Why do we use é instead of está in this sentence?

é is a form of the verb ser, which is used to identify what something is. Because we are defining the object as a book (a permanent identity), we use ser. You would use está (from the verb estar) if you were talking about the book's temporary location, like if it is on the table.

How do we know to use o before livro?

In Portuguese, all nouns have a gender. The word livro is masculine and singular. Therefore, it requires the masculine singular word for "the", which is o. If we were talking about a feminine object like a pen (caneta), we would use a instead (a caneta).

Could I just say "É o livro" without the word "Isto"?