Schematics for a simple but extremely cool sounding sound generator can be found on www.musicfromouterspace.com website once again. This time the number of components that it takes to build this thing can be counted with your fingers and toes.
Impressive sounds can be heard here.
http://meme.no/locomofon/audio/usg1002.mp3
http://meme.no/locomofon/audio/usg1003.mp3
http://meme.no/locomofon/audio/usg1004.mp3
http://meme.no/locomofon/audio/usg1005.mp3
http://meme.no/locomofon/audio/usg1006.mp3
More available here: http://meme.no/locomofon/usg1.php

As far as the operation goes, it looks like the oscillations are created with the Hex Inverter Schmitt Trigger IC by the process of signal feedback. The other IC is a 741 Op-Amp acting as a filter/amplifier and an optional mixer. The schematic looks a little complicated with words like wacky and zany used to describe circuit functions. But really it is very simple. One thing I would do differently is use opto-resistors instead of pots, cheaper and will get a lot more interesting sounds that way.