Here is how JG describes it:
With regards to Yoga, it is impossible to separate the philosophy from the exercise, because the physical moves themselves become forms of meditation. I think that if people really understood just what it is that they are chanting in Yoga class, they would be shocked. Here is a definition of the OM chant that is practiced in Yoga.
OM/ AUM or pranava, is the seed of transcendental realization, and it is composed of the three transcendental letters a-u-m. By chanting OM in conjunction with the breathing process - a transcendental but mechanical way of entering trance - as devised by experienced mystics, one is able to bring the mind, which is usually materially absorbed, under control. OM is the seed of all transcendental sound, and only transcendental sound can bring about the desired change of the mind and the senses.
OM is the direct, literal representation of the Supreme Absolute Truth. By chanting OM and controlling the breathing system, one is able to reach the ultimate state of the pranayama ssytem of yoga and be fixed in Samadhi (trance).
The sound of OM is eternal and goes beyond the conceptions of time. It is pronounced with a nasalized ending, a sound between an N and an M. OM is used to begin sacrifices, mediation, prayers, and before the performance of yoga. To obtain the true benefit of this powerful mantra, one must chant it with full concentration. OM is the symbolic sound representation of the Supreme Personality of Godhead. There is no difference between the Supreme Personality of Godhead and OM .
These three symbolic representations are used by Brahmins while chanting Vedic hymns and during sacrifices performed for the satisfaction of the Supreme. In the Vedic hymns, the word OM is always present.
So much for a harmless little chant!