The nebula is basically hydrogen gas mixed with dust. Established stars can exist in nebulas and reflect their light off of the dust particles. This light means the nebula can be seen with a highly strong telescope.
A nuclear fusion of the dust particles, along with helium and hydrogen gases, produces a round ball with its light and heat. It is called a star at this point and stays in this formation for billions of years. They produce immense amounts of light and are anywhere from a red color to a bluish-white. The sun is in this cycle right now and is estimated to be 4.5 billion years old.
The star swells as it loses hydrogen gas and turns bright red. At this point, the star will have a diameter up to 100 times larger than the sun. Since the red giants are so large, they emit an enormous amount of light.
This begins the end stage of a star. The red giant shrinks into a red dwarf. It becomes about a 10th of the size of the sun and can stay in this cycle for up to a 100 billion years.
The red dwarf fades into the white dwarf. The white dwarf is about the size of the Earth during this cycle. This star will stay in this stage for about a billion years. Some stars will fade away, while others with heavy mass will explode. This event, the supernova is as strong as 100 billion suns. It is launched when gas from another star lands on the white dwarf.