Leonardo was intrigued by the atmosphere and by its effects on the colors and distinctness of distant objects. Though other artists had already begun to mimic the influences of the atmosphere, he was the first to make careful measurements and suggest rules for applying them realistically. He called this subject aerial perspective.

In the morning light Leonardo observed that distant objects look bluer and less distinct than nearby mountains. He also noted that the more distant they were, the more the color approached that of the surrounding atmosphere. His experiments suggested that to correctly color objects at variable distances, artists should; paint the nearest obejcts their true color, paint the one behind proportionately bluer, and the one behind that bluer still.

"Thus if one is to be five times as distant, make it five times bluer."

In painting the Virgin of the Rocks, Leonardo applied his understanding of aerial perspective to create the sense of mountains a great distance away.

Aerial Perspective:
Creating a sense of depth in painting by imitating the way the atmosphere makes distant objects appear less distinct and more bluish than they would be if nearby. Also known as atmospheric perspective.

What causes the haziness and blueness of distant objects?

His writings show that he approached the questions much as a scientist would, using what he knew about optics and the makeup of the atmosphere to formulate his hypotheses. Leonardo recognized that the atmosphere surrounding the earth was composed of moisture and dust as well as air. The further away an object was he reasoned, the more the moisture and dust would reflect light from it.

He also reasoned that the air itself was not blue in color. As Leonardo observed, the opposite is true. Leonardo made observations of smoke and water vapor viewed against dark and light backgrounds. He concluded that the blue color of distant mountains results from warm water vapor in the air illuminated by sunlight in front of the dark background of the mountains. Was Leonardo correct in his scientific understanding of aerial perspective? Not exactly, but considering the limited scientific tools and knowledge of his day, this idea was remarkably insightful.

More Info
http://www.mos.org/leonardo/
http://banzai.msi.umn.edu/leonardo/
http://www.ucmp.berkeley.edu/history/vinci.html