In the most common type of mirage, an object appears to be reflected as if there were a pool of water on the ground. This phenomenon is caused by light refraction -- the bending of light beams. Light bends when it passes from one medium into another -- from air to water, for example, or even from colder air to warmer air.
Mirages occur when there is a rapid shift in air density in the atmosphere -- when the air at one level is a lot hotter than the air at an adjoining level.
This commonly occurs on summer days, when an asphalt road that has been baking in the sun heats the air directly above it, creating a sharp shift in air density levels near the ground. As light passes between the different levels, it bends, creating mirages.
Normally, sunlight bouncing off an object (let's say a car) reflects in all directions. You see the car when your eyes detect this light. On an overcast day, you only see the light that bounces off the car straight toward you. This is how you see things most of the time.
On a sunnier day, the light heading straight toward you acts just like it usually does -- it doesn't move through different layers of air density, so it doesn't bend much. But some of the light that would normally hit the ground actually bends in midair because it moves from the cooler, denser air level into the hotter, less dense air right above the ground.
The lower part of the light wave passes between the layers first, so it speeds up an instant before the upper part. The light that would ordinarily go straight to the ground bends upward and travels to your eyes. The effect is that you see the image of the car twice: once on top of the road, and once in the road surface.
The light from the lower part of the car bends farther upward than the light from the top of the car, so the mirage image looks like a reflection. Your brain assumes that the light is traveling in a straight line, so it seems like there's a mirror image beneath the normal image. This mirage looks just like a puddle of water on the road because, like a puddle of water, it's reflecting what's above it. This sort of mirage is called an inferior mirage because it appears below the horizon.
Check out these top 10 optical illusions at en.globalquiz.org.