How it works is that when you charge a capacitor through a resistor, the capacitor will charge relatively slowly. The rate depends on the value of the components. What the 555 chip does is monitors the voltage level on the capacitor. When it reaches an upper level, the chip discharges the capacitor. When the voltage reaches a lower level, the chip starts charging the capacitor. Thus you get oscillations with the desired timing.

Think of it kind of like filling your sink with water. When the sink gets 2/3 full, you pull the plug from the drain. When the water level drops to 1/3, you put the plug back in the drain. This will give you periodic oscillations. The timing depends on the size of the sink (capacitor) and how much you open the tap (resistor).