I'm think and have heard the term but don't understand how it works or how it is set up??

The scope of your question is very vast . It is better I direct you to relevant website and links.( Just click on them!)

http://www.answers.com/community%20hydroponics?web.x=1
http://www.news.cornell.edu/releases/Oct99/CCE-Hydro.bpf.html

http://en.wikipedia.org/wiki/Hydroponics
http://en.wikipedia.org/wiki/Aeroponics
http://www.cornellcea.com/handbook_home.htm
http://www.hydrotv.com/