Horsepower comes from airflow, plan and
simple. The more air that enters the engine, the more potential power.
Airflow is a function of two engine parameters - displacement, and engine
speed. For a given amount of power output, less engine speed is required
as displacement increases. This is the main argument for stroker
motors - they are capable of producing their power at lower speeds, and
the assumption is that this improves driveability.
It's also important to use all that air in an efficient manner. Good combustion-chamber design and reasonably high compression are necessary for good efficiency. The LT1 uses swirl-port technology to promote good cylinder filling at part-throttle and good distribution of the air-fuel mixture under any conditions. The spark-plug location is also about as good as it's going to get in a standard small-block Chevy (SBC) head. These features allow the use of less timing, as the combustion event takes less time to complete. The reverse-flow cooling does an excellent job of keeping combustion-chamber temps reasonable. Combine all of these together, and they allow for high compression ratios. The stock LT1 runs about 10.5:1 compression (the LT4 has 10.8:1 compression), and more is possible if premium fuel is used.
The LT1 uses roller lifters as OEM equipment. Roller lifters allow steeper ramp profiles, and therefore the valves can open and close quicker. This allows for more "area under the curve" with less duration than typical flat-tappet cams.