The nebulising diffuser works by forcing an air current through a narrow micro-tube which increases its velocity. The pressure at the exit point of the narrow micro-tube is subsequently reduced.
Due to the difference in pressure, suction is created. Hence it causes the essential oil in an alternate micro-tube to rise up. Finally, the fast stream of pressurised air then comes into contact with the essential oil causing fine, atomized micro-particles of oil to be sprayed against the wall of the glass diffuser reservoir. As a result, the smallest mist droplets (1.5 – 5µm) are diffused out of the top of the glass cap in a light vapor, while the larger mist droplets are returned to the bottom of the instrument to be diffused, thus forming a cycle.
Due to the fact that there is no heat involved, the original chemical structure of the essential oils are not altered or destroyed. Therefore, the essential oil molecules are able to be quickly inhaled and absorbed by the human body in their most natural, original state.
Thanks Winnie for putting this explanation together!
Reference – http://organicaromas.com/pages/how-it-works
