All you need is a plate, or shallow dish (preferably square or rectangular), some milk, food colouring and dish washing liquid.
Place a small amount of milk into your dish. Enough to fill the bottom of the dish should do. Then carefully drop your food colouring into the milk.
Take your dish liquid and pour a small amount into the centre of your food colouring, then stand back and watch the reaction between the milk and the dish liquid! My daughter thought this was amazing!
Here is a 10 second video we took of the reaction. It's REALLY cool!
*UPDATE 3.4.2016: The video link seems to be broken somewhere along the way, so I shall remedy this as soon as possible*
I have to thank and credit Flutter Flutter for this tutorial. I believe she may have found it somewhere else, but this is where I found it.