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I was going to school (after a rainy hour) when I saw some patches of shiny colours lying on road. Some small children surrounded that area and thought that it's a rainbow falling on the Earth. (For some 5-6 year old children it is a serious thing.)

I have a similar photo from Google:
enter image description here

It is definitely not a rainbow falling on the Earth but what is it? The road is a busy road and hence I think that's because of some pollutants, oil, or grease.

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the interference pattern of a layer of oil. – user18764 Feb 5 '14 at 17:30
up vote 21 down vote accepted

There is a thorough explanation of the phenomenon on the Hyperphysics site.

What you are seeing is an oil film floating on the water, and the thickness of the oil film is around the wavelength of visible light i.e. around a micron. The film behaves as an etalon because light reflecting from the upper air-oil interface interferes with light reflecting from the lower oil-water interface.

If you were viewing the road in monochromatic light, for example under sodium street lamps, you would see a pattern of light and dark fringes. Because daylight spans a range of wavelengths from 400 to 700nm the fringes from the different wavelengths of light overlap and you get a coloured pattern.

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A very thin floating layer of oxidized oil (helps it spread) captures incoming white light. If oil thickness fits a wavelength of light (or a whole number of them), it reinforces. If not, it cancels. You see a rainbow as changing thicknesses of the oil layer select for individual different wavelengths of light.

Now, the fun part! The rainbow extends into the ultraviolet and into the infrared, as do sky rainbows. It can't be a rainbow fallen to earth, for there is no pot of gold at its end. "8^>)

Experiment: Take a clean flat plane of glass and place upon it a slightly curved clean convex glass lens. Where the two slightly touch there is tiny circular rainbow. If you very gently press, the faint rainbow gets smaller as the distances get smaller. Two stacked clean flat plates of glass will also show broad faint color bands that dance to slight compression. Getting them apart afterward tells you about van der Waals surface interactions. NEVER try this with optical flats! They bond.

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Also useful to look at the "rainbows" under non-incandescent street lighting; sodium vapor or mercury vapor will give some striking effects... – DJohnM Feb 5 '14 at 18:20
    
Add a laser pointer or LED for clean fringes. – Uncle Al Feb 5 '14 at 22:16
    
@ User58220 under a monochromatic light will the oil layer give patterns like on zebra or tiger? – Mukul Kumar Feb 6 '14 at 2:50

It can be interpreted by interfere of light. The thick of the oil film is around the wave length of visible light. incident light enter into oil film, light reflect from interface of water and oil interfere with incident light.Because of the different thickness of oil film, many colors you can see from the surface of the oil film.

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It is observed when a thin layer of oil floats over water..(by thin I mean about a micron) light is dispersed into its constituent colours and colours appear wavy because of unstable conditions of atmosphere and liquid..it is only seen when oil layer is as thick as the wavelength of visible light..if you observe light emitted from burning hydrogen,copper or pottasium on it in a dark room you would probably observe their spectra with fringes as in two slit experiment

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