For starters, it most definitely is NOT chalk. Pastel is pure powdered pigment, which is ground into a paste with a small amount of gum binder, and then rolled into sticks. It is the same pure pigment used in all fine art paints and is the most permanent of all media. It does not contain oil or liquid, and therefore won't darken, crack, fade or blister with time. Pastels from the 16th century exist today as fresh as the day they were painted.
An artwork is created by applying the sticks of dry pigment across an abrasive ground, embedding the color in the 'tooth' of the paper. If the ground is completely covered with pastel, the work is considered a pastel painting, where leaving much of the ground exposed, produces a pastel sketch.
They are also a favorite medium among many artists because it allows a spontaneous approach...there is no drying time. I can essentially leave everything I'm working on and return to it at a later time, picking up right where I left off. So for me, it's the perfect medium.