The Content translation module works by utilizing language code flags. All content entities and field definitions have a language code key. A content entity has a language code column, which specifies what language the content entity is for. Field definitions also have a language code column, which is used to identify the translation for the content entity. Content entities can provide handler definitions to handle translations, or else the Content translation module will provide its own.
Each entity and field record is saved with the proper language code to use. When an entity is loaded, the current language code is taken into consideration to ensure that the proper entity is loaded.