An emulsion is mixture of two liquids that would not normally mix. That is to say, a mixture of two immiscible liquids. By definition, an emulsion contains tiny particles of one liquid suspended in another. Chemically, they are colloids where both phases are liquids. They are typically milky in appearance and the suspended material may be colloidal in nature.
A classic example of an emulsion is oil and water when mixed slowly under vigorous stirring. However, when the agitation is stopped, the two liquids separate and the emulsion breaks down. This is an example of an unstable emulsion.
Stable emulsions can be formed from two immiscible liquids when an emulsifier is used. Such emulsions do not separate out after a change in conditions like temperature or over time.