Extension tubes are simply spacers which allow you to mount the lens further from the camera sensor - so first you fit your extension tube(s) to the camera (this can be just one, or if you like you can stack them), then you mount the lens to the end of the extension tube(s). The added space between the lens and the camera sensor will allow your lens to focus much closer to an object, and the focus distance is reduced the more space you add. In-fact I believe if you add enough, the minimum focus distance can actually be inside the lens!

[My passion-fruit flower macro; the result of the setup above.]

While researching before purchasing, I read that since extension tubes do not contain any optics/glass there will be no loss in image quality. I have since found that this is not entirely true. Although the tubes will not directly degrade image quality, images can be degraded by the action of forcing your lens to operate at extremes for which it was not designed. For example, while editing my passion-fruit flower shot, I noticed some chromatic aberrations (blue fringing) which would not typically be exhibited by a lens of such quality. The fringing was to the extent that it wasn't even entirely removed with the Adobe Photoshop (Camera Raw) chromatic aberration correction on full power!

Another point for consideration is lighting. Small objects just inches from the front of the lens cannot be illuminated with on camera flash. Extension tubes do reduce the amount of light which gets to the sensor, so it becomes more likely that you'll be shooting with (at least some) artificial light. If doing so, you will need to get it off-camera; either with some lamps or in my case, a wireless flash trigger and soft-box fitted to my Speedlite 430EX-II.

Besides the one or two downsides, I am really happy with the tubes and I would recommend them to anyone interested in macro. They're fairly small so won’t take up much space in your camera-bag, and they'll add a whole new level of functionality to your existing lenses.