When a parcel expands or contracts with no heat exchanged between it and its surroundings, we say the process is adiabatic.

In real life, there are instances when heat is exhanged, otherwise we would not be able to maintain an energy balance on Earth with conduction and convection in addition to all the radiation stuff. In fact, fogs and dew/frost are formed when heat is removed from the air by conduction or convective mixing. Whenever heat is exchanged, the process is diabatic.

Thus, fog is produced at the ground by diabatic cooling of the air. As you might have guessed by now, formation of clouds above the ground, away from the cooling influence of the ground, must be accomplished adiabatically, and it happens when air rises and expands. Adiabatic expansion during an air parcel's ascent causes the air parcel's temperature to decrease; adiabatic compression during descent causes air parcel temperature to increase.