Let's say you want a smaller breed of cat. You take one small cat, and breed it with another small cat.
The new litter of cats will tend towards being small. If you take the smallest of those, and breed it with another cat which is the smallest of another small cat litter, the process will continue.
Give it enough time, you'll have cats far smaller than was originally possible for that species of cat.
Like with the difference between Grand Danes and little Micro-Poodles.