Any theory of the formation of the solar system must explain at least
the following two observations: First, the planets, with the exception
of Pluto, orbit in almost the same plane (the "ecliptic").  Second,
the inner four planets are small and rocky, while the outer four
planets are large and gaseous.  One theory that does a reasonably good
job of explaining these observations is the disk model.

The Sun is thought to have formed by the collapse of a large
interstellar gas cloud.  The original cloud was probably thousands of
times larger than the present solar system.  Initially the cloud had a
very slow rotation rate (it's essentially impossible for one of these
clouds to have a rotation rate of exactly zero).  As it collapsed, it
began rotating faster (much like a skater will spin faster if she
pulls her arms to her sides---this principle is known as the
"conservation of angular momentum").  The collapse process is not 100%
efficient, though, so some of the material did not fall into the
proto-Sun.  This rotating gas that was left behind settled into a
disk.

In addition to gas, interstellar clouds can also contain dust.
Therefore, the rotating disk consisted of dust grains and gas.  In the
process of settling into a disk---and even after the disk had
formed---the dust grains began to collide and stick together.
Initially quite small, this process of colliding dust grains sticking
together (known as "accretion") began to build up larger dust grains.
The accretion process continued with large dust grains accreting to
form small pebbles, small pebbles accreting to form large pebbles,
pebbles forming rocks, rocks forming boulders, etc.  Initially this
process is quite random: Two dust grains collide only if their paths
happen to cross.  However, as particles became larger, they exert a
larger gravitational force and attract smaller particles to them.
Hence, once started, the accretion process can actually speed up.

The collapse process itself can generate considerable heat.
Furthermore, as the Sun's mass grew, it eventually reached the point
at which fusion reactions in its core could be sustained.  The result
was that there was a heat source in the middle of the disk: the inner
parts of the disk were warmer than the outer parts.

In the inner part of the disk, only those materials which can remain
solid at high temperatures could form the planets.  That is, the dust
grains were composed of materials such as silicon, iron, nickel, and
the like; as these materials accrete they form rocks.  Farther from
the early Sun, where the disk was cooler, there were not only dust
grains but also snowflakes---primarily ice flakes of water, methane,
and ammonia.  In the outer parts of the disk, not only could dust
grains accrete to form rocks, but these snowflakes could accrete to
form snowballs.

Water, methane, and ammonia are relatively abundant substances,
particularly compared to substances formed from silicon, iron, etc.
In the inner part of the solar system, where only rocks could remain
solid, we therefore expect small planets, whereas in the outer solar
system, where both rocks and ices could remain solid, we therefore
expect large planets.  (Not only did the gaseous planets form from
more abundant substances, they also had more raw material from which
to form.  Just compare the size of Earth's orbit to that of Jupiter's
orbit.)

The formation of the giant planets, particularly Jupiter and Saturn,
deserves an additional comment.  It is currently thought that they
formed from a run-away accretion process.  They started accreting
slowly and probably initially were quite rocky.  However, once their
mass reached about 10--15 times that of Earth, their gravitational
force was so strong that they could attract not only other rocks and
snowballs around them, but also some of the gas in the disk that had
not frozen into an ice.  As they attracted more material, their
gravitational force increased, thereby attracting even more material
and increasing their gravitational force even more.  The result was
run-away accretion and large planets.

One of the problems with this scenario for the formation of Jupiter,
though, is that it seems to take longer than the disk may have
existed.  The conventional scenario predicts that Jupiter might have
taken several million years to form.  Alan Boss (2000, Astrophysical
Journal, vol. 536, p. L101) has suggested that the conventional model
for the formation of Jupiter is wrong.  His work indicates that a
giant planet might also form from small, unstable clumps in the disk.
Rather than being "bottom-up," like the conventional model, his
"top-down" idea is that an entire region of the disk might become
unstable and collapse quite quickly, perhaps in only a few hundred
years.

One of the results of finding planets around other stars is the
realization that this model does not require the planets to always
have been in the same orbits as they have today.  Interactions between
the planets, particularly the giant planets, and the disk of material
could have resulted *migration*.  The giant planets may moved inward
or outward from their current locations during their formation.  If
planets can migrate during or shortly after their formation, it makes
it easier to explain the presence of Uranus and Neptune.  A
straightforward application of the above model encounters a slightly
embarrassing problem:  The time to form Uranus and Neptune is longer
than the age of the solar system.  If, however, these planets formed
at a closer distance, then migrated outward, it may be easier to
understand why Uranus and Neptune are at their current distances from
the Sun.  (See Science magazine, vol. 286, 1999 December 10 for more
details.)