It doesn't, actually. Gunpowder burns very, very quickly, on account of the fact that one of its components, potassium nitrate, supplies oxygen to the charcoal and sulfur to achieve an accelerated burn rate. This combustion produces a much larger volume of hot gas than the gunpowder itself, and if that gas is in a combined space, then it will force its way out with an explosion. However, if the gunpowder is not in a confined space, then it will just burn since the gas will simply expand into the surrounding air.

Excellent question! Gunpowder is a powder mixture of very combustible (burnable) chemicals, namely sulfur, charcoal, and potassium nitrate.

When you light gunpowder on fire, the same type of chemistry is happening there as when you, for instance, burn firewood in a fireplace or light up charcoal on a barbecue grill. Burning materials release heat and hot gas at different rates depending on their properties. Since gunpowder comes in a fine powder, a lot of it is quickly burned, resulting in a lot of hot gas and heat being released at once. All this energy forces the gunpowder outward, further igniting more of it and causing the explosion that we can see.

What makes gunpowder seem to "explode" is because it burns very rapidly. It seems to explode because when it is compressed in a barrel, it is packed in a very tiny space which means great pressure. So when it burns very fast, in a very confined space, the gases are built up and "explodes".