Affiliate networks is the middle ground between advertisers and publishers. Advertisers are companies / people who want to advertise their company, product or service. Publishers are there to display adverts for these companies.

A recommended affiliate marketing website is: http://www.cj.com/

I used them a long time ago when I first started on the web and they were one of the first sites that provided me with some money. They even sent me a Christmas card .

Once you are signed up at that site for example, it allows you to place links on your website which when clicked get you a commission. After you have reached the minimum payout marker you are paid the money that you have earned.

I hope that explains the basics of how they work.