It's probably useful at this point to explain how search engines work, as in order to understand SEO, you first need to consider how search engines rank web pages.

The job of a search engine is to provide the user with relevant results based on the search query which they have submitted. It is in the interests of the search engine to return the most relevant results first, as a user will quickly tire of a search engine which consistently returns irrelevant web pages, and may go somewhere else for the information they need.

To do this, search engines send out programs (sometimes these are called 'spiders' or 'robots') which 'crawl' websites to evaluate their content. The data is then collated and stored (or indexed) by the search engine so that when a user types a search term into the search engine, it only needs to look through it's internal files to return results rather than searching the web. The search engine will therefore rank the pages on your site based on how closely the data collected by the spiders / robots matches the user's search terms.