Crustaceans (crabs, lobsters and prawns etc) need oxygen, just like we do, but instead of using lungs inside the body they use gills outside the body to get it.
Gills (and lungs) work because oxygen is a very small molecule. During respiration oxygen molecules first dissolve into a layer of moisture surrounding a thin membrane. Then the oxygen molecules, because they are so small, cross right through the membrane into the circulatory system (the blood) of the animal.