Since this is a general question, I'll give a general answer. Many of my examples will come from English, because the history of English is one with which I am familiar.
General answer: Modern lanuages evolved due to interaction with other languages, development of dialect, standardization of spelling and grammar, and changes in use over time.
Explanation:
Languages evolve through changes in use over time. Often, these changes are a result of adding a new element to the linguistic make-up of an area. Such an element might be something like invaders who move into an area. The locals pick up words from the tongue of the newcomers; over time, these words are added to the vocabulary of the original language. An example of this is the introduction of French into English after the Norman invasion.
Over time, people in region A develop a different dialect than region B people. They may both be speaking the same language, but each dialect will have unique words and pronunciations. As people move back and forth between the regions, words and pronunciations are spread, and some will become standard to the language. Slang words also often come to be standard to a language.
People are also relatively lazy speakers, and will conserve words and grammar whenever possible. This leads to the trimming of words and grammatical structures wherever meaning can be conserved.
Standardization of spelling and grammar can also have a dramatic affect on the way words are pronounced and used. In Shakespeare's day, for example, spelling was not yet standardized. You could say "too bee orr nott too bee," just as correctly as "to be or not to be." The standardization came later. Standardized spelling makes it easier to understand meaning, as well as standardizing the pronunciation somewhat.
Colonialism also plays a big role. As we move across the globe and work with other countries, we might find that their language has a word that perfectly encapsulates something our language doesn't. Words such as "candy" and "shampoo" stem from the time of the British Occupation of India, and have their roots in Hindi. Likewise, I am petitioning for the addition of the Japanese word "genki" into the English lexicon. :)
In a situation where two groups with different languages are forced to communicate a pidgin language will develop. Words or phrases from the pidgin will join the mainstream language over time. For example, the phrases "no go," "no can do," and "long time no see" all come from a Chinese-English pidgin. These languages can also develop into a Creole, although not all pidgins do.
Furthermore, occassionally we'll find we need new words. Some times we can simply tack a prefix or suffix onto an existing word, creating a new one. Other times only something completely new will do. In these cases, we can create whatever we feel best encapsulates the idea. Often, changes in technology result in a whole new vocabulary. Imagine going back in time and meeting your own teenaged Great-grandmother. "Sweet!" you say. "Here--let me get a snapshot on my digital camera, and then we can listen to some cool MP3s I downloaded to my iPod last night." To you or me, the meaning is perfectly clear, but to teenaged great granny, you sound like a raving lunatic. She doesn't understand concepts like download, digital, or even snapshot.
Grammar rules also move in and out of fashion, being changed fairly regularly. There was a time when splitting an infinitive was practically a sin; nowadays, we see it as an archaic rule left over from Latin and not really applicable to modern English. Now we're debating about whether or not one needs a comma before the "and" in a list. In a decades, our syntax may have changed dramatically.
If you combine all of these elements and add a hefty dose of time, you can see how modern languages have evolved. And they continue evolving every day. Twenty years from now, your vocabulary will have expanded to include all kinds of new ideas, slang words, technologies, etc. Just like your teenaged Great Grandmother didn't understand you, it's likely you won't understand your Great Grandson when he turns up, either.
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