It's a combination of real-time space battles and Choose Your Own Adventure style branching exploration. Each node on the path through a sector is randomized - it could be a battle, a shop with supplies, a friendly in need of help, or any number of other possibilities - and you have a limited amount of time to progress through a sector before the pursuing enemy fleet catches you. It's a balance of hitting as many nodes as possible for loot and upgrades while not getting caught.
You can also upgrade your ship and crew (think MechWarrior style of upgrading) and micromanage your crew to effect repairs and repel boarders.
Did I mention it's one of the most difficult and frustrating games in existence? If you lose your ship you start over, and there are no checkpoints or autosaves. The random nature of it means you can get in over your head very quickly, especially if you've been unable to repair your ship.