Kava, once gulped down, goes to work on the body via about fifteen different compounds, known as kavalactones. These different compounds are present in different amounts, depending on the exact strain of kava, but the ones that are responsible for kava's popularity are known as kavain and desmethoxyyangonin. Kavain induces a feeling of relaxation, like a sedative.
Unlike a sedative, it doesn't do so by knocking out the brain. Instead it's a muscle relaxant, physically relaxing the body and letting the brain follow along. This leaves kava drinkers relaxed but alert. Desmethyoxyyangonin, meanwhile, increases dopamine in the brain, giving people a mild euphoric sensation. (Another kavalactone, yangonin, works the same brain channel as THC, and also contributes to the good feelings that people have while on kava