The circuit, uses a two-transistor direct-coupled oscillator that has a frequency determined by CI, R2, and the (skin) resistance across the touch pads. Since CI and R2 are fixed values, only the skin resistance across the touch pads can vary the sound of the oscillator. To sustain oscillations, CI feeds a portion of the output from Q2 back to the input of Q1 through resistor Rl.
Transistor Q1 is an npn type and transistor Q2 is a pnp type. The output of Q2 is fed into a small speaker. The circuit relies on the fact that the human skin conducts electricity.