Definitive explanation:
Google had to find a way of making their search engine faster and more accurate than anyone else’s, so what they came up with is this.
They wrote a program, which trawls the whole of the web, downloading every webpage it finds, this program is the actual Google bot itself.
These web pages are then scanned for keywords, Meta data and links to other web pages. The links are the important bit as it's sort of like a vote for a page. i.e. if you had two WebPages on the net all about Aerobics, one of them will have more links to it from other peoples web sites on the net. Google then count up the links, the site with the more links to it is obviously more popular, and very likely to be more of what you were searching for.
People caught on to this and started to progressively create fake domains that had loads of links to their client’s websites so they would get higher in the search list. Google didn’t like that as it's cheating, so they regularly tweak their search algorithm to prevent companies fooling their engine!.
Hope all that made sense?