Admission is fairly selective and focuses on interest, ability, and accomplishment in math and science.

There certainly are significant differences between individuals, but nearly everyone is smart and scientifically motivated.

[1] Purely merit-based admissions [2] Very selective, with a total enrollment under 3000 [3] They focus much more on the hard sciences. They are primarily a technical institution.

I didn't notice any legacy admissions when I was there, and only a very small number of students who couldn't hack it and quickly washed out.

(Many students left before graduating, maybe half, but it was only rarely because they couldn't do the work. My good friend had to leave for medical reasons, it was very sad. Another left as a sophomore. 10 years later, he asked if he could come back, and the Institute said "sure", and he graduated with straight A's. I asked him if he'd gotten smarter in the preceding decade, he laughed and said no, it just took him 10 years to get ready to work hard.)

Being one of, if not the most prestigious technical university in the world tends to be one of those self-fulfilling things. Since you're known as top of the line, you get your choice of top tier applicants, who in turn propagate the institution's reputation for prestige.

They have a merit-based admissions reputation at least, and their small numbers keeps it exclusive.

On the other hand, most Stanford guys I've met have also been sharp, and they graduate 700 PhDs a year according to someone below.