When they get a biopsy, they take a tiny chunk of you and send it to the lab, where a pathologist will run a couple tests here and there and compare the chunk to various slides under the microscope and say "you have plantar fascitis" or "you have ebola" or, more likely, "you're probably going to survive."
The doctor will probably give you a shot of local anesthetic, then whack a chunk out of you, then stick it in a tiny jar and send it along.