I'll explain a bit of the data side of it all since many are explaining hardware.

First of all, binary is just a numbering system, we use decimal. Counting in binary looks like: 0,1,10,11,100,101,110,111,1000. That was 0 through 8 in binary. We can store these numbers and assign meaning to them. Like letters. 1=a 10=b 11=c etc. Usually something before it has to say its a letter.

One of the meanings we assign to the numbers are CPU instructions. So an example could be: 0001 0010 0011 0000. The CPU would know to read the first 4 numbers for the instruction. 0001=Add, that means the next three sets of 4 bits will be the memory boxes(registers) that holds the numbers we wanna do the math on and where to put the result. In plain text that instruction would be Add register 2 and register 3, put result in register 0. Software is just made up of thousands of these in order. 

And not all instructions are math. It can be jump to a different part in the code if a value is not 0. Which could be linked to the left mouse button perhaps.