This scale uses Bioelectric Impedance Analysis (BIA). Here's a simple rundown of how this works:

The electrical impulse (you won't feel it) is conducted by water in your body. Lean tissue, like muscle, is (hopefully) well hydrated, so the impulse is conducted through easily and quickly. On the other hand, fat tissue is not well hydrated, so the impulse encounters resistance, and has more trouble passing through. Can you see how being dehydrated could slow the impulse down? Just one of the many reasons to stay well hydrated.

Using the BIA reading, genger, height and weight, this scale quickly and accurately calculate both your body fat and body water percentages.

This is a much handier way of doing this than attaching electrodes to your hands and feet.