basic linked list declaration..need explanation

hey guys,
Can someone please explain what this does?

typedef struct nodetag
{
DATA directory;
struct nodetage *next;
} NODE;

How does the 'next' bit point to the next item in the list? It would be helpful is someone provided a thorough explanation of the code. Thanks
A :)

See this: http://cslibrary.stanford.edu/103/LinkedListBasics.pdf

I hope this suffices.

*next is a pointer to struct nodetag. It is how you get from one node to the next node. Ask more questions.

I know what next does..I even know that it is a pointer to struct nodetag..I don't get as to how does it work? What is the logic behind how it works? In fact, what is nodetag??
There we go..I've asked more questions..
A :)