Diffuse nebulae are clouds of dust and gas in interstellar space, several light years across. Stars are formed when diffuse nebulae collapse under the influence of gravity, compressing and heating until nuclear fusion begins, igniting a new-born star. Diffuse nebulae can be further broken down into emission nebulae and reflection nebulae. You can find more information at The Columbia Encyclopedia. Be sure to check out some spectacular Hubble Space Telescope photos of nebulae.