To play pachinko, you insert money into the machine and you get small steel balls. You turn a know on the lower right hand side which shoots the balls rapidly into the machine, much in the manner of a pinball machine only rapidly with multiple balls.
The balls drop through a series of pegs and you score points when the little metal balls pass through certain gates. It is a form of gambling, but winnings are paid off in more little metal balls, not money. You trade the balls for prizes such as cigarettes, lighers or small toys. Although it is illegal, there are usually rooms close by that will purchase the prizes for cash.
Wikipedia says that no pachinco parlor without a cash payout window has ever been documented, so while it is illegal, it is at least tacitly tolerated.
It is a lot like the game Plinko on the Price is Right, only slot machine sized with much more Las Vegas style.
-Gary Milner
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