There are a bunch of satellites up there, around 20,000 km aove the surface of the earth. They all transmit a very accurate (nanosecond) time of day and their orbital information. Speed of light delay means the signal is delayed by between 66 and 86 milliseconds.
As you know where the satellite is, you know how far away from it you are - or at least, you know how much further away one is than another. From that you can calculate two places on the globe where that relationship holds - two points where two distance arcs cross. A third satellite reference gives you another arc that should cross one of the two points you got earlier.
In practice, noise, atmospheric distortion, errors in the orbital information, the fact that the satellites are bombing around at about four thousand miles an hour and such like conspire to give you a circle that your somewhere within; the more satellites you can see, the smaller that circle.
Neil