Google Translate is a free service that provides instant translations of sentences, documents and even whole websites between 57 different languages. How does it work? "When GT generates a translation, it looks for patterns in hundreds of millions of documents to help decide on best translation for you. By detecting patterns in documents that already been translated by human translators, GT can make intelligent guesses as to what an appropriate translation should be. This process of seeking patterns in large amounts of text is called "statistical machine translation"."
Google uploaded a video embedded below that explains how Google's machine translation service works. It's fascinating to see how much Google's translation service has improved in past 4 years and how many Google services using it.
More Info: Google Translate Tour