According to the software's website, "Prince is a computer program that converts XML and HTML into PDF documents. Prince can read many XML formats, including XHTML and SVG. Prince formats documents according to style sheets written in CSS."
Prince is available for free if you want to use it on a single computer, but the server license costs $3800. "Prince is an ideal printing component for server-based software such as web applications and database systems. Using Prince, data in XML can easily be converted to PDF documents that can be printed, archived or downloaded over the web," which is exactly the way it's used in Google Docs.
Håkon Wium Lie and Michael Day gave a talk at Google in November 2007 about the software.
{ Thanks, David. }