If you ever get your hands on one in person, the principle will be really clear. It's basically a small ramp with a notch at the back (the high end of the ramp) that you look through and align with the front sight. The ramp is marked with numbers indicating various ranges (100, 150 etc). There is a piece underneath the ramp that sets its height and you slide it along until it points at the number representing the estimated range. Moving this slide will have raised or lowered the ramp, changing the alignment with the front sight.

Different types of rifles use different approaches, but it's all the same concept. Mechanically changing the height of the rear sight to suit the range.