Every file system has a database of files. Without this database, it wouldn't know that all that data on the disk was actually a bunch of files; it would just be one giant mass of ones and zeroes. Things like the file's name, location, creation and modification dates, etc., are stored in this database. This is all called metadata it's data about other data (the file). A file's data and metadata are separate.
Like ElDiablo said, when you normally empty the trash, only the database (metadata) is affected. But when you use Secure Empty Trash, both the metadata AND actual data are erased. What's more, the data (and I think the metadata, too) is overwritten many times (I think 7; maybe 35) with random data, so that it cannot be recovered even with specialized data-recovery hardware.
Don't be too paranoid, though. I hardly ever use Secure Empty Trash. It's too slow to use for anything that you don't reaaaaally need destroyed. I find it useful on other computers (like at libraries or schools), but on my own Mac, there's rarely any reason to use it.