Automatic wrist watches stop functioning if not worn even for a day. How does wearing them on our hand make them function?

    Automatic wrist watches, like any other watch, also need energy for functioning.  This comes from the up, down and twisting movement of our hand.

There is a small pendulum-like component which rotates around a fulcrum due to our hand’s movement. The movement of the pendulum (clockwise and anti-clockwise) is used to wind a spiral spring. This action is similar to winding it manually. The energy stored in a fully wound spring is adequate to run the watch for a day or two. Within this time, if the watch is not worn, there is no recharging of the spiral spring. Hence the watch will naturally come to a stop.  

Unlike winding type watches, automatic watches have a different mechanism: a rotor which can rotate freely (like a free wheel in a bicycle).

 Our hand movements make the rotor rotate and wind a coil spring. The rotor frees itself to the original position after the winding. As a result the rotations of the rotor further tighten the spring. The watch works as the spring releases very slowly.

There is also a release mechanism by which the rotor is freed completely when the coil spring is wound to a preset maximum.

If the watch (spring) is kept idle for some time, there is no rewinding of the spring, and so it stops functioning.