Gelatin itself is made of a protein. (Proteins usually form solids at room temperature.) When you mix the jello powder into the hot water, the protein actually dissolves in the water. But like many things, it's harder for the protein to stay dissolved in cold water than in hot water. So as the solution cools down, the protein comes out of solution. It turns back into something like a solid in some ways. But it doesn't settle onto the bottom, like a mixture of water and sand would.
As the protein molecules come out of solution, they stick to each other. When they stick to each other, they form a complicated matrix that runs all through the jello. You can think of it as a giant mixed-up jungle gym of little protein molecules all sticking together. The water molecules get caught up inside this matrix so they can't just drain out.
So jello is a sort of semi-rigid structure suspended in a liquid. That's an example of something that's called a 'colloid'. If you heat it up enough, the protein structure will become dissolved again and it will become a liquid all through. But if you cool it down enough, the liquid water will freeze, becoming a solid itself.
-Tamara (w small mods, mw)
(republished on 07/25/06)