Cloud formation occurs when water, evaporated from the ground into gaseous water vapor, condenses into small water droplets in the atmosphere. However, the water vapor-laden air must have some means by which it is transported upward. One such means is orthographic cloud formation.
This occurs when the wind direction pushes air up the slope of a topographical feature such as a mountain. As air rises, it expands and cools. Since cooler air holds less water vapor, condensation begins, clouds form, and precipitation can follow. Another impact of this process is that the opposite side of the mountain from the prevailing wind can be very dry.
However, clouds of course also form in the absence of mountainous terrain. This occurs when a parcel of air near the surface, containing evaporated water, is heated by the warm sunlit ground. Warmer than the adjacent atmosphere, it rises. As the air rises, its pressure drops in accord with that of its surroundings (air pressure decreases with altitude, a phenomenon mountain climbers are familiar with). By the ideal gas law, the pressure of a gas is proportional to its temperature. Therefore, a rising parcel of air cools.
The tallest clouds form in the case of absolute instability, illustrated above (click to enlarge). The parcel of air begins at the ground at a temperature of 40° C. As it rises, it cools. However, in the unstable case, the air temperature of the ambient atmosphere drops more quickly than the temperature in the rising parcel of air (the rate of its cooling is known as the dry adiabatic lapse rate). As a result, the cooling air nevertheless remains warmer than its surroundings and continues to rise. Eventually, its becomes too cold to hold all of the water vapor and condensation begins at the condensation level. Condensation releases heat to the atmosphere, so the temperature decrease of the parcel slows (to what is known as the wet adiabatic lapse rate). The resulting condensation forms a cloud, whose lower extremity is the condensation level.
At the top of the above diagram, the parcel temperature is still much higher than the atmospheric temperature, so the air rises yet more, continuing to increase the height of the cloud on the way. In situations such as this, a cumulonimbus cloud may form.
Cumulonimbus can extend from a few thousand feet from the ground over 10 miles (16 km) upward. It is these clouds that are responsible for many types of extreme weather, including severe thunderstorms, hail, and even tornadoes. However, even for these enormous clouds, there is an limit to their upward growth: the tropopause. The tropopause is the boundary between the troposphere below and the next layer of the atmosphere, the stratosphere, above. As indicated at the beginning of the post, the height of the tropopause varies with latitude. It is characterized by a reversal of the decline in temperature with height that takes place up to this point. Beginning at the tropopause and into the stratosphere, temperature again begins to increase with height (as shown near the bottom of the figure below).
Unlike in the troposphere, where the only significant source of heat was the sun-heated surface below, the stratosphere derives heat from another source: the absorption of solar ultraviolet radiation by the ozone layer. Oxygen and ozone (O3) molecules interact with incoming ultraviolet rays, impeding their passage to the Earth's surface and therefore protecting it from most of this harmful radiation. In the process, they absorb heat. The result of all this is that air just above the tropopause is always stable: temperature increases with height. Rising parcels of air do not penetrate much past this point. Rather, they spread out laterally, forming the anvil top characteristic of cumulonimbus clouds and illustrated above. By virtue of their momentum, a few parcels enter a bit into the stratosphere; this is the "overshooting top" in the diagram.
However, in rare cases, clouds can form outside the troposphere. For example, polar stratospheric clouds (PSCs) may sometimes form in high latitude regions. They occur in the lower stratosphere, at altitudes varying from 6 to 15 miles (10-25 km), where temperatures plummet to below -100° F. At these especially low temperatures, water vapor can condense directly into ice crystals. The more spectacular PSCs are the nacreous clouds, which are composed entirely of these crystals. They are most visible just after sunset when the Sun has disappeared below the horizon on the ground but still illuminates the stratosphere. The ice crystals diffract light, producing beautiful iridescent displays.
This image shows nacreous clouds over McMurdo Station, Antarctica. Though they are most often seen over that continent, they also appear occasionally over northern Europe, North America, and Russia. PSCs are of scientific interest because they can serve as sites for chemical reactions that destroy ozone. Understanding the climatology of these unusual clouds helps to monitor the regional variation of ozone in polar regions.
In addition to PSCs, there is another type of upper atmospheric cloud that occurs even at even higher altitudes. Noctilucent clouds, so named because they are only visible at night well after the Sun has passed below the horizon, form in the mesosphere. This layer is defined as being the second region where temperature decreases with height. The clouds form generally around 50 miles (80 km) above the surface. Though not fully understood, it is thought the formation of noctilucent clouds is due to meteoric dust. This dust is the result of small objects from space breaking up upon entering Earth's atmosphere and serves as a site for the formation of ice crystals. Though the amount of moisture water vapor this high is minuscule, the temperature here can plummet to a frigid -180° F at high latitudes, supporting ice crystal formation.
The above image, taken from Nunivak Island, Alaska, shows noctilucent clouds after sunset. These clouds are at such a high altitude that they reflect sunlight from below the horizon back down to Earth. Studying the locations where these clouds form can reveal concentrations of dust (meteoric or from other sources such as volcanoes) in the mesosphere as well as shed light on how the upper atmosphere changes with the climate. Apart from their scientific value, upper atmospheric clouds join the aurorae as some of the most beautiful displays to be found in polar skies.
Sources: The Encyclopedia of Weather and Climate Change by Juliane Fry, https://www.wunderground.com/cat6/Methane-Giving-Noctilucent-Clouds-Boost?cm_ven=hp-slot-1, http://www.richhoffmanclass.com/chapter4.html, https://www.nasa.gov/mission_pages/sunearth/science/atmosphere-layers2.html, https://www.atoptics.co.uk, https://www.nasa.gov/multimedia/imagegallery/image_feature_680.html, https://www.sciencedaily.com/releases/2014/04/140411091939.htm