Consider the circuit diagram shown. You can recognize the two resistors connected in parallel.
With the ohmmeter you measure a total resistance of 500 Ω. The formula describing this is a bit more complicated... 1/R_{Total} = 1/R_{1} + 1/R_{2} You can rewrite the formula to get...
R_{total} = ( R_{1} × R_{2} ) / ( R_{1} + R_{2} ) 

= ( 1000 Ω × 1000 Ω ) / ( 1000 Ω + 1000 Ω )
= 500 Ω
The total resistance of a parallel circuit of resistors is therefore smaller than any of the individual resistances.
The result becomes clear when you measure the currents...