When the cat moves suddenly, the delicate hairs detect the movement of the fluid and crystals and rapidly send messages to the brain, giving readings on the body's position.
This is similar in principle to the instrument in an airplane called the "artificial horizon" or "altitude indicator" that tells the pilot the position of the plane's wings in relation to the horizon. When a cat loses its balance and actually takes a spill, the vestibular apparatus kicks in. This helps the cat register which direction is up and triggers the "righting" reflex that cats rely on to turn themselves in midair, adjusting the orientation of the body so that they land squarely on all four feet.
This organ, together with the tail, which acts as a counterbalance, permits the cat to perform its remarkable signature acrobatics. The Manx, a tailless breed, is thought to have an especially sensitive vestibular apparatus to compensate.