In extreme conditions, tardigrades can suspend their metabolism. In such state, the needs for oxygen, water, and nutrients are greatly reduced. The mechanism on which they survive is not entirely clear. However, experiments have shown that tardigrades have a protein that protects their DNA again ionizing radiation.

Although tardigrades can survive extreme conditions, they are not indestructible. If a tardigrade stay in such environment for too long, they too will perish. Furthermore, tardigrade is made up of more than thousand species. A tardigrade that survives a specific extreme environment may not survive in the other.

Tardigrades aren't truly indestructible, just very resilient. They can survive desiccation, as well as inordinate amounts of ionizing radiation. The reason why they can survive radiation is that their cells have something called eutely: they have lost most of their DNA except for those cells that are used for reproduction, which means that they have less DNA to damage. I don't know the mechanism by which they survive desiccation.

Scientists are still figuring out the answer to your question, but they're finding that Tardigrades have strange genes: read here.

I put your question into a google search, and the first answer, from Mother Nature Network, says Tardigrades are tiny and can survive lots of radiation and heat - but your question was "WHY" or "HOW".

I knew Tardigrades were called 'water bears,' but I didn't know about 'moss piglets'. Tardigrades are microscopic animals blessed with two very cool nicknames — the water bear and the moss piglet. ... Water bears are as indestructible as they are tiny. They've been known to survive in extreme temperatures. They shrug off extreme doses of radiation and laugh in the face of the silent vacuum of space itself read here.

Tardigrades have adapted to endure many harsh conditions that seem extreme to us humans - not necessarily to live well in those conditions, but to survive. It seems that they can survive better at extreme cold temperatures than hot temperatures, and different species of tardigrades can survive different types of conditions such as high/low pressures, dehydration (no water), radiation, and so on. Research suggests that they may survive dehydration by making a specific type of sugar that protects their cells, or perhaps by making a specific protein that replaces water in the tardigrade cells as dry out occurs.

Tardigrade's DNA is protected from radiation by a protein that helps the DNA not break. The exact mechanisms ("hows") of tardigrades' toughness are still undergoing active research.