
Georeferencing
If an image spatially represents data in a more or less accurate fashion, then it can be taken into ArcGIS and dropped into an .mxd file.
By rotating, shifting, and scaling the image, it can then be lined up with features representing that same area. From that point on, a GIS analyst can pin points from the image to where they match the data layer and stretch/skew the rest of the image as necessary to line up all the features.
From that point, any features in the image can then be digitized and match the initial spatial data. This applies anywhere from historical prints to modern features like sewage pipes, buildings, or bus routes. (The not-so-eagerly awaited Massive Cinematic Universe crossover of Bedknobs and Broomsticks and Planes, Trains, and Automobiles)
In this case, the coast, water features, and a handful of still matching street lines were used to align the historical map. From that point on, in an editing session a handful of historical landmarks and rail lines were generated for use in the ultimate map layer.