Like the altimeter, the VSI is a pressure instrument, and is connected to the aircraft's static port. Whereas the altimeter measures the absolute pressure, the VSI is designed to leak away pressure at a slow rate. The rate of the leak is calibrated to drive a display indicating feet per minute.
Because of the way it works, the VSI is a very slow-responding instrument, taking several seconds to "catch up" with the reality of what is actually happening. It is common for beginner pilots to "chase the needle", trying to establish a steady rate of descent or climb, or simply staying at zero.
This usually results in the aircraft wandering up and down in altitude - a form of pilot-induced oscillation (PIO). By the time the instrument catches up and shows the desired rate, the beginning pilot may have already gone well past it.
More experienced pilots know to refer to this instrument after establishing performance in some other manner. Generally, a pilot would set the appropriate power level and place the nose in the proper position relative to the horizon (or by using an attitude indicator). As the plane stabilizes its airspeed in the new configuration, the pilot glances at the VSI and makes any fine adjustments needed.