This is going to be short and to the point. S/MIME is basically a secure form of MIME. What is MIME? It stands for Multiple Internet Mail Extensions. Basically this lets users using different e-mail applications send mail to someone else that has a totally different application. Below is how the S/MIME Protocol works.

#1. User creates message with an attachment
#2. E-mail application places the message in MIME format.
#3. A unique digital fingerprint/message digest is generated by the hash algorithm.
#4. The digest is encrypted by the private key
#5. The e-mail application creates a new message as an envelope for the original message.
#6. A certificate containing a public key is attached to the message and it is sent through the Internet.
#7. The recipientís e-mail application checks to make sure that the message digest (when encrypted by the public key matches the original message, that the certificate is from a trusted Certificate Authority, and that the senderís address matches the address that in in the certificate.
#8. Lastly the message is disassembled into its original form with the attachment.