(4) Water drops in a dispersion medium of air Explanation: A colloid is a substance microscopically dispersed evenly throughout another substance. A colloidal system consists of two separate phases: a dispersed phase (or internal phase) and a continuous phase (or dispersion medium) in which the colloid is dispersed. A colloidal system may be solid, liquid, or gas. Cloud is a colloidal dispersion of Water drops in a dispersion medium of air.