Ever since I was a kid, I have been fascinated by the puff balls I would find under Oak trees. I never did take the time to learn more about them. This one was under a tree in Delta Ponds. When I looked the subject up I learned some amazing things:

"Puffballs on an oak tree come from insects, fungi or bacteria causing round growths on the trees, called galls. Wasp larvae commonly cause oak tree galls. The galls have smooth, hairy or spiny exterior surfaces with puffballs and larvae inside."
Source - http://www.ehow.com/info_8735722_puff-balls-oak-tree.html