The newest generation ebook readers, are based on electronic paper, or epaper, on which the text and pictures are displayed by electronic ink - eInk.  This page explains this technology.

There are different kinds of electronic paper. In the current technology the paper is made of a thin layer (coating) of conductive synthetic material. The coating contains millions of capsules filled with oil, with floating black and white pigment parts in it. These pigment parts react to an electrical load.
Under the tension, the capsules turn black or white, just like ink dots on paper. By varying the tension, grey color can be made.

An important characteristic of ePaper is that the consition of the capsules does not change as long as there is no difference in tension. To put it differently: the text or the image will remain on the electronic paper, even when the ebook reader is switched off. On some ebook readers, people can read thousands of pages on one battery load.

A second important characteristic is that there is no need for background lighting to look at the picture. Just like with normal paper, it is necessary to use an external lighting source to be able to read. This results in a less effort to read from an ebook reader, than for example a PC monitor. Plus, since the ereader is based on reflection of daylight just like paper, the e-reader screen is perfectly readable in sun light.