To answer that question, let's step back and take a look at how a CD actually works. Remember that all computer data, regardless of what type, is stored as zeros and ones. The computer then interprets the zeros and ones to make sense out of the madness. We used to have punch cards that did the trick. Now we have hard drives that store data in magnetic form.
CDs are no different.
This may come as a shock to you, since a CD's surface appears seemingly smooth to you. Each pit represents a bit of data. After the laser hits the surface, it will be reflected off the CD's surface. The reflected light is then intercepted by a series of mirrors and sensory devices, which analyzes the light and determines the bit the light represents. The digital signal processor in the CD basically analyzes the brightness of the reflected light.