Ghost ship (Superior mirage)

A mirage can be also observed at the sea in the vicinity of the geographical pole.

In this area, the upper layers of air are hot compared to the lower layers of the air.
Rays of the ship are refracted away from the normal until total internal refraction occurs. After that, the rays of light are refracted following a curve bending towards the normal until they reach the eyes of the observer.
The image is inverted and appears in the sky.

Superior mirage of tanker in Finland (http://virtual.finland.fi/finfo/english/mirage.html).

The Superior Mirage of Iceburg (http://www.phys.ufl.edu/~avery/course/3400/gallery)

Water ! Water !! ( Inferior Mirage )

Mirage = An optical phenomenon that creates the illusion of water, often with inverted reflections of distant objects, and results from distortion of light by alternate layers of hot and cool air. Also called fata morgana.
While driving a car on a hot day, you may see a pool of water on the road. But as you approach that particular spot, you find that the pool does not really exits.

The above occurrence is called mirage. It is caused by refraction and total internal reflection.

Mirages normally occur in the daytime when the weather is hot.
The hot air near the ground surface warms the air above it causing a light ray passing through it to be refracted upwards. Because the light ray reaching the viewer's eye appears to be coming from the ground surface, and because the reflected ray follows the same path, an apparent image is seen.

Other inferior Mirage phenomena:
1. Sunset
photo source : http://mintaka.sdsu.edu/GF/explain/simulations/inf-mir/Kaplan_photos.html
The miraged image of the Sun's (lower edge).

Learn more :
http://www.euhou.net/index.php?option=com_content&task=view&id=212&Itemid=13