How does it exactly happen? And what exactly is it? Light? Shadow? Illusion? Reflection?

well,it's an action between sun and atmosphere in special conditions,have u read the article?it has lebih information and for even lebih info read it here:
link
and it was not a stupid soalan at all honey :)

Basically, a solar wind caused sejak the sun blows against Earth's magnetosphere, causing the Warna to appear in the sky. :D