It uses Inno Setup installer:
https://github.com/serge-rgb/milton/blob/master/Milton.iss
I have used it before multiple times and I have found it the most reasonable one:
http://www.jrsoftware.org/isinfo.php
Inno Setup default wizard generates project that is very nice by default. And it has Pascal language for advanced scripting, but I've never had need to use it. You can do a lot of things with default configuration/wizard options.
Before that I used NSIS installer:
http://nsis.sourceforge.net/Main_Page While it is as good as Inno, the most painful part was the scripting, because you needed to do that in pseudo-assembly language. Not sure if that is changed now or not.