Optical rangefinders use the principle of parallax. Two lenses focus on the same object from different ends of the rangefinder, then both images are superimposed on each other by means of a focusing knob. The knob is calibrated with the range.
Since parallax is greatest (most measurable) at short ranges, optical rangefinders are most accurate at short ranges. Expect an accuracy of +,- 5 yds at ranges of less than 100 yds, but on the order of 50 yds at 500 yds. Much of the performance of these devices will depend on how precisely the operator can focus.
The best known optical rangefinders are from Ranging. Their website is http://www.ranging.net/