Why does earth travel in an elliptical orbit around the Sun, rather than just getting pulled in all the way? This happens because the Earth has a velocity in the direction perpendicular to the force of the Sun's pull. If the Sun weren't there, the Earth would travel in a straight line. But the gravity of the Sun alters its course, causing it to travel around the Sun, in a shape very near to a circle. This is a little hard to visualize, so let me give you an example of how to visualize an object in orbit around the Earth, and it's analogous to what happens with the Earth and the Sun.

Imagine Superman is standing on Mt. Everest holding a football. He throws it as hard as he can, which is incredibly hard because he's Superman. Just like if you threw a football, eventually it will fall back down and hit the ground. But because he threw it so hard, it goes past the horizon before it can fall. And because the Earth is curved, it just keeps on going, constantly "falling," but not hitting the ground because the ground curves away before it can. Eventually the football will come around and smack Superman in the back of the head, which of course won't hurt him at all because he's Superman. That is how orbits work, but objects like spaceships and moons are much farther from the Earth than the football that Superman threw. This same situation can be applied to the Earth orbiting the Sun - except now Superman is standing on the Sun (which he can do because he's Superman) and he throws the Earth.