Interpreters execute programs one step at a time.

Interpreters, as opposed to compilers ,which do the same thing in a different way, are a way of executing code in a given programming language .
An interpreter often consists of the following steps:

lexing

The raw string which the program is (as all programs really are) is given to the lexxer to be turned into a long list of tokens which represent slightly more abstract things such as numbers, openbrackets, closedbrackets, and symbols.

parsing

The tokens are converted into a tree like structure, (usually reffered to as a AST or Abstract Syntax Tree) based on what they represent.

traversal

The AST is traversed by some sort of tree traversal algorithm and recursively evaluated according to a set of rules to execute the program. (see here for more on ASTs)

All of my programming languages including loon are interpreted