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Diffusion is a very basic principle of liquids and gasses. When diffusion occurs, molecules in an area of relatively high concentration move to an area of relatively low concentration. In our experiment the food coloring represents molecules of high concentration. When mixed with the water, which has a lower concentration of food coloring, the molecules in the food coloring diffuse (spread out) to fill the entire container, evenly throughout. When this happens we call it Equilibrium.
The molecules of food coloring are in constant motion, as are all molecules. Many of these molecules move away from the concentration of food coloring, just because of their random direction. Now, since there are more food coloring molecules moving out of the concentrated area than there are moving into it, the food coloring spreads out until it fills the entire container of water.