Here's a video demonstrating how it works.
Note: Go to the last step (step 9) of this instructable to see a video of how this claw was used. This can give you some ideas of what you can possibly do with this claw.
Step 1: Building Materials
Note: All required K'nex pieces are STANDARD sizes
*Blue spacers (x10)
*Tan single connector (x7)
*Gray spacers (x4)
*Gray single connector (x20)
*Gray double connector (x5)
*Yellow BROKEN rod [2 1/8" length] (x1)
*White rod (x18)
*Green rod (x13)
*Orange double connector (x5)
*Red triple connector (x11)
*White 8-connector (x2)
*Blue rod (x8)
*Yellow rod (x11)
*Purple [3-dimensional] 4-connector(x8)
*Navy [3-dimensional] 7-connector (x2)
*Green 4- connector (x5)
*Gray small gear (x1)
*Red medium gear (x2)
*Triangular plates [see photo for reference] (x4)
*Motor pack [Battery power pack is acceptable] (x1)
For further help, look at the photo of various K'nex pieces and mouse over each piece to show how many of each is needed.
Step 2: Claw Top
Step 3: Claw Bottom
Step 4: Apparatus
Step 5: Jaws
Step 6: Claw Main Assembly
Note: Make sure to calibrate the jaws so that they are symmetrical, position-wise, according to the teeth of red medium gears.
Step 7: Motor Setup
Note: Use any old broken rods first before breaking new ones to conserve K'nex pieces.
Step 8: Mounting
Warning: This may be the most difficult part of assembling the claw.
Step 9: Completed Claw
Warning: Do not use a power source over 12V DC without adding resistors.
Note: The claw that this instructable shows, was originally for a K'nex claw/crane machine game. See the video below of its use. There are endless possibilities of utilizing this claw! Explore and modify the claw in anyway that is desired.