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How do Neodymium magnets work,

Physics
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neodymium magnets are the strongest kind of permanent magnet available. Their strength, small size and low cost have made numerous advances in personal audio, electric motors and other areas possible. Neodymium magnets are made of an alloy called NIB--neodymium, iron and boron. They belong to the rare-earth class of magnets, that is, metal magnets made with rare-earth elements. The arrangement of electrons in rare-earth elements lets them develop strong magnetic fields. Rare-earth elements are expensive, but the magnetic fields are so strong that you can make the magnets very small. The smaller magnets end up being less expensive.:)
see this article http://www.ehow.com/how-does_4926376_neodymium-magnets-work.html
Tell me more about the electron arrangement

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actually their is atom arrangement rather than electron arrangement:)
a magnetic domain is formed http://en.wikipedia.org/wiki/Magnetic_domain :)
The same way all ferromagnets work. If you understand how iron magnets work, you understand how Nd magnets work.
i dont have a good understanding of how the electrons are behaving
They're not doing anything they wouldn't already be doing, as far as their location, energy, motion, et cetera is concerned. The only novel thing is that their spins are correlated over a long distance. That is, the spin of an electron on this atom here tends to be in the same direction at the spin of the electron on this other atom waaay over here, many nanometers away.
Think of it this way. Imagine all the planets and moons and asteroids of the Solar System. They are all spinning on their axes, and let's imagine that in all cases that gives rise to a magnetic field (it doesn't, and most objects do not have a magnetic field, but let that go for the moment). If all those spins were pointing in the same direction, the magnetic fields would add, and the magnetic field of the Solar System would be as large as possible. On the other hand, if those spins were pointing in random directions, not lined up, some tilted drunkenly off this way, some that, then the magnetic fields would not add but mostly cancel, and the overall magnetic field of the Solar System would be close to zero (if we ignore the Sun, which has a monstrous field). But the planets don't need to change orbits or anything, or even spin faster or slower. They just have to have their axes no longer corrleated.
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