Image Taken From: http://www.sandia.gov/LabNews/LN04-25-97/lightning.gif
Once the cloud is charged, there are several different ways that lightning can occur. There are intracloud discharges, cloud to ground discharges, cloud to cloud discharges, and cloud to air discharges. The most common type of lightning is the intracloud discharge, in which the flash occurs entirely within the cloud. However, the most commonly studied form of lightning is the cloud to ground discharge. Not only is this the most visible form of lightning, but also the most pertinent to human life, as its effects are the most damaging. In cloud to ground discharges, the negatively charged base of the cloud induces a positive charge on the earth below. In this case, the clouds and the earth are acting as two plates of a giant parallel plate capacitor.
Image taken from: http://thunder.msfc.nasa.gov/primer/
A more recently discovered class of lightning occurs above the cloud layer, jumping from the tops of clouds into the stratosphere. There are three types of this rare lightning that have been discovered; red sprites, blue jets, and elves. All are associated with severe thunderstorms. Red sprites only last for a few thousandths of a second, and appear suddenly, often in clusters of two or more. They are dim and reddish-colored, rising to heights between 50 and 90 kilometers (30 and 50 miles) above the cloud layer. The blue jet is brighter than a red sprite, and occurs as a blue, cone-shaped burst that rises to heights between 20 and 50 kilometers (10 to 30 miles) above the cloud layer. Both red sprites and blue jets were first photographed in 1989 by John R. Wincklyer in Minnesota. More than a thousand images of red sprites have been recorded since then, and numerous blue jets have also been documented. Elves were announced as a new type of lightning in 1995. They are doughnut or saucer shaped light bursts that are about 400 kilometers (250 miles) in diameter, and occur roughly 100 kilometers (60 miles) above the cloud layer. These flashes last less than a thousandth of a second, and because of this short appearance, scientists are still unsure of their color, although elves are thought to be a green color.