prakṛteḥ—of material nature; kriyamāṇāni—all being done; guṇaiḥ—by the modes; karmāṇi—activities; sarvaśaḥ—all kinds of; ahaṅkāra-vimūḍha—bewildered by false ego; ātmā—the spirit soul; kartā—doer; aham—I; iti—thus; manyate—thinks.
The bewildered spirit soul, under the influence of the three modes of material nature, thinks himself to be the doer of activities, which are in actuality carried out by nature.