Controlling variables used by an application

One thing that I have seen commonly used by game cheating engines it to control variables that the game is using. The idea is to edit the variables used by the game to say, give ones self unlimited ammunition. One example of this type of tool is tsearch.

I have no idea how to replicate this attack on my own, nor what it is called. I would like to learn about how it works, and how to mitigate it.