The cloud feature is a funnel cloud. It is a rotating, funnel-shaped condensation cloud that descends from the base of a cumulonimbus or towering cumulus cloud, often in a severe thunderstorm capable of producing a tornado.
A funnel cloud forms when air spiraling into a low-pressure vortex expands and cools. If the air reaches its dew point, water vapor condenses into visible droplets, creating the familiar cone or tube. The visible cloud is not the entire tornado; the tornado is the rotating column of air, while the funnel is its condensed-water outline.
A common mix-up is assuming every funnel cloud is a tornado. In standard usage, a funnel cloud has not reached the ground or water surface. Once the rotating circulation connects with the surface, it is classified as a tornado, even if the visible funnel does not extend all the way down. Conversely, some tornadoes are partly or wholly obscured by rain, dust, or debris.