That is a very broad question considering the complications and processes involved.
Basically, you have your raw HSC test marks and your raw school assessment mark. These are the marks that you have actually obtained in the test and submitted by the school in Year 12.
This is the process involved for EACH course:
EXAMINATION MARK:
Your RAW examination mark is not the mark you recieve. This raw mark goes through a process called aligning which is done by judges setting the standards and performance descriptors of your mark. Despite this, your ranking in the state with that mark does not change. Your ALIGNED examination mark is the mark that is reported to you. The raw examination mark makes up half of the marks used for scaling.
SCHOOL ASSESSMENT MARK:
To ensure that no school is disadvantaged or advantaged from the assessment marks due to different standards set by teachers, the raw school assessment mark goes under a process called moderating. This process, aligns the entire school's Year 12 assessment marks in a way so that it follows the performance in the examination. For more details on moderating refer to the following thread:
http://www.boredofstudies.org/community/showthread.php?t=6642
RAW/SCALED HSC MARK:
Your moderated school assessment marks make up half of your raw HSC mark, while your raw examination marks make up the other half. That raw HSC mark is used for scaling. After the scaling process has been done the new mark is called the SCALED HSC mark. This mark is determined by the performance of the whole candidature in the subject. In other words your ranking in a specific course determines your scaled mark.
UNIVERSITY ADMISSIONS INDEX:
Your best 8 units and 2 units of English of your scaled marks are then taken to a process called aggregrating and ranking is performed (which is a complicated process beyond my understanding). This finally results in your University Admissions Index.
In a nutshell refer to this flowchart:
http://www.boredofstudies.org/other/flowchart.pdf
For more information try this thread:
http://www.boredofstudies.org/community/showthread.php?t=60687
For extra detailed explanations refer to this site:
http://www.uac.edu.au/admin/uai.html
Also, if you are in Year 12 and doing your HSC, you should recieve a booklet called "You and your UAI" before the HSC examinations begin. This gives a brief outline of how the scaling system works with some examples explained at relatively fundamental level. Here's the booklet as a PDF file for 2004:
http://www.uac.edu.au/pubs/pdf/uaibook-2004-web.pdf