Funnel cloud

A funnel cloud is a funnel-shaped cloud of condensed water droplets. They usually appear with a rotating column of air. These extend from the bottom of a cloud that does not touch the ground or a water surface. A funnel cloud can usually be seen as a cone or needle shaped cloud that extends out from the main cloud base. Funnel clouds, very often, develop when supercell thunderstorms happen.
If a funnel cloud touches the ground, it becomes a tornado. Most tornadoes begin as funnel clouds. Many funnel clouds that appear do not actually touch the ground, and do not become tornadoes. Tornadoes can only be seen when they pick up stuff off the ground (debris), but one can see them from a distance of many miles.
A funnel cloud that makes contact with water is called a waterspout. 
A funnel cloud that touches the ground in front of a snow squall is called a winter waterspout.
Cold-air funnel clouds.
Cold-air (or cold-core) funnel clouds are usually short-lived and are usually much weaker in strength than the tornadoes produced by supercells. Cold-air funnel clouds usually do not touch the ground, but here have been reports that it can happen. Then, they become weak tornadoes or waterspouts.
They are a common sight along the Pacific Coast and USA, usually seen in the spring or autumn.