After GRUB has loaded the kernel into RAM it turns over execution to the kernel. The first thing that the kernel does is to initialize memory and set up memory allocation tables. It initializes all I/O devices including the hard drives and mounts the root filesystem (/) in read-only mode. The rest of the filesystems are mounted later.
After initialization, the kernel loads init, the mother of all processes and turns control over to it. Init is always PID (Process ID) 1.
| NOTE: Kernel initialization and launching init is the end of the boot process. The Startup process is launched by init and takes over the process of launching daemons and programs that bring the Linux computer up to a usable state. |
There is a really good exposition of the complete kernel boot process in excruciating detail at http://duartes.org/gustavo/blog/post/kernel-boot-process if you are interested.