Low-dropout regulator
A Low-dropout regulator (LDO) is a device which will regulate a stable voltage as long as the input voltage is "somewhat" higher (depends on the exact regulator) than the required output.
It is important to know and understand that an LDO does this by "burning of" the excess voltage and this can and does result in quite a lot of heat which must be handled in the design. The amount of energy burned off is easy to calculate. Let's imagine using a 3.3V regulator from a 5V source. The voltage drop over the regulator is 5V - 3.3V = 1.7V. If using 100 mA that would result in 1.7V * 0.1A = 0.17W (or 170 mW) of power.
Model/Simulation
Internally, LDOs are build around a MOSFET and a OpAmp which operates as a comparator (click here to run simulation)
When running the simulation it is quite easy to understand how it functions. The output voltage is controlled by a N-channel MOSFET which is being controlled by an opamp. The opamp acts like a comparator which compares an internal voltage reference (in the simulation that is a Zener diode) with the output voltage divided down to an appropriate level.