Electronic self-steering is controlled by electronics operating according to one or more input sensors, invariably at least a magnetic compass and sometimes wind direction or GPS position versus a chosen waypoint. The electronics module calculates the required steering movement and a drive mechanism (usually electrical, though possibly hydraulic in larger systems) causes the rudder to move accordingly.

There are several possibilities for the interface between the drive mechanism and the conventional steering system. On yachts, the three most common systems are:

• Direct drive, in which an actuator is attached to the steering quadrant, at the top of the rudder stock inside the boat. This is the least intrusive method of installation.
• Wheel mounting, in which a motor is mounted near the steering wheel, and can be engaged with it when in use. This typically involves either a belt drive or a toothed gear-ring attached to the wheel itself, and is a common option for retro-fitted installations on yachts with a wheel.
• Tiller-pilots are usually the only option on smaller vessels steered with a tiller. They consist of an electrically driven ram which is mounted between the tiller and a fitting on the side of the cockpit. Some are entirely self-contained, needing only a power supply, while others have the control unit separate from the actuator. These are quite popular, as they are maintenance-free and easy to install.

Workings of a marine tiller-pilot

Depending on the sophistication of the control unit (e.g. tiller pilot, steering wheel attached Chartplotter, ….), electronic self-steering gear can be programmed to hold a certain compass course, to maintain a certain angle to the wind (so that sailing boats need not change their sail trim), to steer towards a certain position, or any other function which can reasonably be defined. However, the amount of power required by electrical actuators, especially if constantly in action because of sea and weather conditions, is a serious consideration. Long-distance cruisers, which have no external source of electricity and often do not run their engines for propulsion, typically have relatively strict power budgets and do not use electrical steering for any length of time. As the electronic autopilot systems require electricity to operate, many vessels also make use of PV solar panels or small wind turbines on the boat. This eliminates extra pollution and cuts costs

Information from wikipedia