First of all, it is natural (despite it having an ominous sounding E number (E968). You will find it in plants, vegetables and fruit. Technically speaking, erythritol is a polyol or sugar alcohol.
Let's look at the chemistry first. Common sugar consists of carbon, nitrogen and oxygen; it's chemical formula is C12H22O11; it is a pure carbohydrate. Common sugar consists of a glucose ring connected to a fructose ring. As you may remember from your chemistry class in high school, a fructose ring contains five atoms, and a glucose ring six. Each ring contains one oxygen atom; the other atoms in the ring are carbon.
Erythritol is a smaller molecule with its chemical formula being C4H10O4. It is sometimes (and confusingly really) called a sugar alcohol and is member of the group of polyols. It was first discovered in 1874. On ingredient lists you may find it under its ominous E968 name.
The generalized formula for sugar alcohols is (CHOH)nH2. For Erythritol, n=4.
Just looking at its formula you will immediately see Erythritol is a carbohydrate. So then why is this ingredient used as a sugar substitute in low-carb diets?
This is where the concept of net carbs comes in. Net carbs are total carbs minus polyol carbs. It turns out that polyols are barely processed by the human body.
Erythritol sweetness is about 70% of that of sugar, by weight. So in order to reach the same sweetness as sugar, you would have to increase the Erythritol quantity in your recipe by 40% - however, I find many recipes overemphasize sugar.