ETF shares trade like stocks on an exchange. For example, an order to buy 250 shares of an ETF on the “ask” (offer price), would be placed through a brokerage account and then executed at the lowest possible ask price where 250 shares of the ETF were available in the secondary market.
There’s a special mechanism that’s unique to ETFs (and largely responsible for the enhanced liquidity and tax efficiency that the vehicle offers) that allows the supply of ETF shares to fluctuate depending on demand. It’s called the creation/redemption process and it involves a few key players to help ensure the ETF trades efficiently.