Radioactive dating was first invented by Earnest Rutherford in the year 1905. He used it as a means of determining the actual age of earth. Although the initial techniques were flawed it laid the basis of the method and has since then become a reliable means of dating organisms. It uses the composition of carbon in actual specimens.
Then it uses the amount of radioactive carbon present in the fossil or remains and uses it with formulas to calculate the actual age. It is very straight forward once you get to know the actual composition of the specimen you are examining.