How does air tag operate

How does the AirTag operate

Bluetooth.

In the publicity page AirTag, Apple summarises the communications technology behind AirTag:

How does it work?

Your AirTag sends out a secure Bluetooth signal that can be detected by nearby devices in the Find My network. These devices send the location of your AirTag to iCloud — then you can go to the Find My app and see it on a map. The whole process is anonymous and encrypted to protect your privacy. And itʼs efficient, so thereʼs no need to worry about battery life or data usage

how can I track it with no Wi-Fi or internet service

You need to use the FindMy app to locate an AirTag; Internet access will be required for this.