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The Cocoons are the second stage of the Gremlin life cycle, being the penultimate stage before the Gremlin itself.
Overview[]
After they eat after midnight, the Mogwai forms a slimy cocoon that wraps around them. Inside, the Mogwai goes through a metamorphosis from a small and furry creature, to a tall and scaly creature, they're known as Gremlins. The process usually takes a couple of hours and afterwards, they hatch and come out of their cocoons as Gremlins, ready to wreak havoc and destruction.
This process was very similar to that of a caterpillar when it metamorphoses inside its cocoon to become a butterfly and moth.