yer its basically a magnet or several magnets with coils of wire wrapped round them, here goes the bit of physics:
The whole principle they work on is electromagnetic induction, the string when picked vibrates through the magnetic flux lines of the magnet in the pickup and thats induces a alternation current in the coil.
As mr ardvark said the frequency of the alternating current depend on the frequency that the string vibrates and thats where ya get youre sound from when its amplified. :p