Like most Culture orbitals, Masaq' orbits (not circles) its star, Lacelere. It is slightly tilted, so as it rotates, roughly half of the inside is in starlight and half is in shadow.
Some notes by Banks here:
Perhaps the easiest way to envisage an Orbital is to compare it to the idea that inspired it (this sounds better than saying; Here's where I stole it from). If you know what a Ringworld is - invented by Larry Niven; a segment of a Dyson Sphere - then just discard the shadow-squares, shrink the whole thing till it's about three million kilometres across, and place in orbit around a suitable star, tilted just off the ecliptic; spin it to produce one gravity and that gives you an automatic 24-hour day-night cycle (roughly; the Culture's day is actually a bit longer). An elliptical orbit provides seasons.
Of course, the materials used in the construction of something ten million kilometres in circumference spinning once every 24 hours are far beyond anything we can realistically imagine now, and it is quite possible that the physical constraints imposed by the strength of atomic bonds ensure that such structures will prove impossible to construct, but if it is possible to build on a such a scale and subject such structures to forces of these magnitudes, then I'd submit that there is an elegance in using the same rotation to produce both an acceptable day-night cycle and an apparent gravity which makes the idea intrinsically attractive.
An idea of how the day-night cycle appears on the surface of an Orbital can be gained by taking an ordinary belt, buckling it so that it forms a circle, and putting your eye to the outside of one of the belt's holes; looking through the hole at a light bulb and slowly rotating the whole belt will give some idea of how a star appears to move across the sky when seen from an Orbital, though it will also leave you looking rather silly.