(thanks goes out to Xenus)
The existence of a cloud or clouds near the Sun has, however, been established by what are called solar backscatter observations in which the lyman-alpha emission from the Sun is reflected back to the Earth from distant material outside the solar system. There is, apparently, a medium called the Local Fluff in which the solar system is embedded, which has a density of about 0.1 atoms/cc, a temperature of 10,000 K, and a relative velocity with respect to the solar system of about 20 km/sec based on a slight doppler shift in the reflected emission. McClintock and his coworkers in 1978 used data from the Copernicus satellite which involved measuring the Local Fluff towards stars with distances between 1.3 and 14 parsecs, and concluded that the Local Fluff extends about 3.5 parsecs. Frisch and York, in 1983, surveyed 140 stars out to several hundred parsecs from the Sun and detected a pattern of emission that indicated a dense cloud located about 17-35 parsecs from the Sun towards the Galactic Center in Sagittarius. In a 1983 Nature article ( vol 302, p. 806) Francesco Paresce proposed that the Local Fluff is the low density, ionized outer layers of this cloud, and that the Sun has just recently entered the outer regions of this dense cloud.
Astronomers Priscilla Frisch and Daniel Welty at the University of Chicago announced at the June, 1996 meeting of the American Astronomical Society ( see the New York Times, Science Supplement, June 18, issue) recapitulated the earlier proposal that the Sun may have already entered the Local Fluff a few thousand years ago. Observations by Dr. Jeffrey Linsky at the University of Colorado of 18 nearby stars indicated that the Local Fluff cloud surrounding the solar system was not a uniform cloud, but contained cloudlets of very different internal density with one of these located between the Sun and the nearby star Alpha Centauri.
Astronomers John Watson and David Meyer at Northwestern University have also discovered that in the Sun's vicinity, the interstellar medium is filled with many cloudlets with a size comparable to the solar system. Radio astronomers have also observed the phenomenon of interstellar scintillation in the radio signals from distant quasars, and deduced that the interstellar medium is far from smooth, but contains clumps and filaments at many different scales.
The solar system is, apparently, moving along a path that is certain to take us closer to the Sco-Cen expanding superbubble. The 'wall' between the Local Bubble and the Sco-Cen bubble now seems to consist of an increasing density of cloudlets of varying size and density. The Sun, after apparently spending many hundreds of millennia in quieter regions of the Local Bubble, is apparently now moving nearer one wall of this cavity towards us from the direction of Scorpio/Centaurus. Rather than a smooth wall of material, it consists of many individual pieces and cloudlets. When the solar system enters such a cloud, the first thing that will happen will be that the magnetic field of the Sun, which now extends perhaps 100 AU from the Sun and 2-3 times the orbit of Pluto, will be compressed back into the inner solar system depending on the density of the medium that the Sun encounters. When this happens, the Earth may be laid bare to an increased cosmic ray bombardment. To make matters worse, the Earth's magnetic field is itself decreasing as we enter the next field reversal era in a few thousand years. If the Earth's field is 'down' during the same time that the solar system has wandered into the new could, the cosmic ray flux at the Earth's surface could be many times higher than it now is.
The biological effects may not be so severe. We just don't really know. Fossil records show that in previous field reversals, there was hardly a sign of any biological impact caused by species extinctions or mutations. We don't really know when the last time it was that our solar system found itself in a dense interstellar cloud, so we cannot look at the fossil record to see what effects this might have had. Since all of the major extinctions seem to be related to tectonic activity, or to asteroid impacts, there isn't much left over to argue that there will be a dire effect of the next cloud passage upon the biosphere. If you believe our knowledge of the solar vicinity, the next cloud passage could happen within 20 - 50,000 years. I guess we will just have to wait and see.