Can I switch the sim in my damaged Cell Phone to a new Cell Phone?

I dropped my simple little Samsung 225 cell phone in water, and since then several functions are not working well. (For instance, if I turn the phone off, the only way I can turn it back on is to take the battery off and then reinsert the battery.) However, the phone is still serviceable, but T-Mobile wants to charge me and arm and a leg (About $200) for this $25 phone. Therefore, I am wondering whether I can buy the phone on the market, and then insert my old sim into the new phone. In such a case will the new phone still connect with T-Mobile's service. Or, is there possibly another work-around where I can get a completely working new phone and avoid being overcharged by T-Mobile.

Thanks for any help,

JD