This is an expansion of GregS's comment.
Suppose I know all the one hundred single-digit * single-digit
multiplications (from 0 * 0 = 0
up to 9 * 9 = 81
), and someone asks me to calculate 561 * 845
. I could say, "sorry I can't multiply numbers that large"; or, I could remember my childhood education and do this:
561
845 *
----------
2805
2244
4488 +
==========
474045
which requires only that I can do, in any given step, a multiplication within my known range, or an addition (with carry).
Now, suppose that instead of decimal digits, each of the symbols above was instead a 32 bit word; and instead of me, we had a processor that can multiply 32 bit words to a 64 bit result, and add (With carry) 32 bit words. Voila, we have a system for doing arbitrarily large binary multiplications.