What's happened to the Sun? Sometimes it looks like the Sun is being viewed through a large lens. In this case, however, there are actually millions of lenses: ice crystals. As water freezes in the upper atmosphere, small, flat, six-sided, ice crystals might be formed. As these crystals flutter to the ground, much time is spent with their faces flat, parallel to the ground. An observer may pass through the same plane as many of the falling ice crystals near sunrise or sunset. During this alignment, each crystal can act like a miniature lens, refracting sunlight into our view and creating phenomena like parhelia, the technical term for sundogs. This image was taken in 2010 in Stockholm, Sweden. Visible in the image center is the Sun, while two bright sundogs glow prominently from both the left and the right. Also visible is the bright 22 degree halo -- as well as the rarer and much fainter 46 degree halo -- also created by sunlight reflecting off of atmospheric ice crystals.
Explanation from: http://apod.nasa.gov/apod/ap110110.html