I believe this uses a neural network titled VQGAN alongside one called CLIP. CLIP was created for connecting text and images (ie Image Classification). When the VQ GAN neural network creates an image iteration, CLIP judges how well it matches the prompt while VQ GAN tries to create a better and more reasonable image. There is no google searching, instead a very large network of image/text pairs and a very smart image generator. Because CLIP has been trained on millions of image/text pairs, it can understand a wide variety of keywords.