Why do some waterfalls create a misty rainbow near the base?

The spray from a waterfall contains countless small droplets suspended in the air. When sunlight enters these droplets, it bends, reflects off the inside surface, and bends again as it exits. That process separates white light into colors, producing a rainbow if the observer stands at the right angle. The effect is especially vivid near large falls such as Niagara Falls on bright days. Mistbows can appear even when the sun is high, because the spray provides the droplets needed for the optical effect.