There was another thread made ages ago that talked about induction motors with an in depth explanation, so you might want to have a look at it:
http://www.boredofstudies.org/community/showthread.php?threadid=1476
The basic principle of an induction motor is that a moving magnetic field around the circumference of a metal disc causes the disc to rotate, and this "moving" magnetic field is created by several electromagnets placed evenly around the disc, and each electromagnet is switched on SEQUENTIALLY. Each electromagnet coil is connected to an AC power source, and the AC power sources must have a certain phase difference relative to eachother so that each electromagnet is switched on sequentially. This simulates a magnetic field moving around the disc, hence the disc spins.
It's important to know that the advantage of AC induction motors over standard AC motors is that an induction motor has less moving parts and no brushes are needed so there's less friction, less heat, more efficiency, less wear & tear. Also AC induction motors are quite cheap to manufacture, making them one of the most common type of motor used today (in stuff like power appliances, drills, saws etc). The disadvantage of induction motors is that they are quite inflexible because their operating speed cannot be easily controlled or changed, since the speed is dependent on the frequency of the AC voltage supply and the number of electromagnet poles used.