A stereo, or dissection, microscope is a specialized compound microscope that has two spatially-separated optical paths. When a user looks through a stereo microscope, the two light paths image the specimen at slightly different angles (parallax) which is interpreted as stereo vision. Stereo microscopes generally have a lower magnification than high-mag compound microscopes because 1) we manipulate and dissect relatively large objects, and 2) low magnification necessarily has a broader depth of field. This property is useful for dissections.
The two separated light paths of a stereo microscope. Diagrams "a" and "b"also shows the two separate light paths for achieving true stereo vision. The left diagram shows a more conventional stereo, or dissecting microscope with a moderately large working distance. Diagram "b" shows a stereo microscope with an extremely long working distance, used for medical applications. (From Leica).
Early, and less expensive, stereo microscopes had fixed magnifications. They achieved this by having a rotating objective nosepiece with two or three objective pairs. Modern stereo scopes have zoom magnification. Here's a Wikipedia article describing how zoom works:
Zoom magnification:

Axial movement of a diverging lens, located between the magnification lens elements, changes magnification by selecting or rejecting circumferential light rays. When all rays are imaged (top) , the lens is at the lowest magnification. By selecting only the central rays (bottom) the image will be magnified.