The joystick on this module is very similar to the 'analog' joysticks on PS2 (PlayStation 2) controllers. Directional movements are simply two potentiometers - one for each axis. Pots are ~10k each.
This joystick also has a select button that is actuated when the joystick is pressed down. There are 5 pins on board: VCC, GND, X, Y and Button. Connect the module with 5V power suppy with VCC and GND, you can read out the joystick status by X,Y and button pins.
Please visit Itead's wiki page for more info about this product.