There are several criterions that search engines follow to determine a site's rank for certain key or search words. One of these includes incoming links to the site. The page rank of a site is somewhat related to the number of inward links it has.
One way links and search engine rankings have a great cause and effect relationship. Think of it as a business referral scheme. The business with the more referrals is most popular and hence, search engines place them higher. The reason behind it, as many place it, is that the more links you have, higher are the chances of a visitor coming to your site over these links!
