A blister is a small pocket of body fluid (lymph, serum, plasma, blood, or pus) within the upper layers of the skin, usually caused by forceful rubbing (friction), burning, freezing, chemical exposure or infection. Most blisters are filled with a clear fluid, either serum or plasma. However, blisters can be filled with blood (known as "blood blisters") or with pus (for instance, if they become infected). The word "blister" entered English in the 14th century. It came from the Middle Dutch bluyster and was a modification of the Old French blostre, which meant a leprous nodule—a rise in the skin due to leprosy. In dermatology today, the words vesicle and bulla refer to blisters of smaller or greater size, respectively. To heal properly, a blister should not be popped unless medically necessary. If popped, the excess skin should not be removed because the skin underneath needs the top layer to heal properly. Causes
A blister may form when the skin has been damaged by friction or rubbing, heat, cold or chemical exposure. Fluid collects between the upper layers of skin (the epidermis) and the layers below (the dermis). This fluid cushions the tissue underneath, protecting it from further damage and allowing it to heal. Friction
Intense rubbing can cause a blister, as can any friction on the skin if continued long enough. This kind of blister is most common after walking long distances or by wearing old or poorly fitting shoes.
Some chemical warfare agents, known as blister agents or vesicants, cause large, painful blisters wherever they contact skin; an example is mustard gas. Blood blister
A blood blister usually forms when a minute blood vessel close to 
the surface of the skin ruptures (breaks), and blood leaks into a tear between the layers of skin. This can happen if the skin is crushed, pinched or aggressively squeezed. Medical conditions
There are also a number of medical conditions that cause blisters. The most common are chickenpox, herpes, impetigo, and a form of eczema called dyshidrosis. Other, much rarer conditions that cause blisters include:

Bullous pemphigoid: a skin disease that causes large, tightly filled blisters to develop, usually affecting people over the age of 60. Pemphigus: a serious skin disease in which blisters develop if pressure is applied to the skin; the blisters burst easily, leaving raw areas that can become infected. Dermatitis herpetiformis: a skin disease that causes intensely itchy blisters, usually on the elbows, knees, back and buttocks. The blisters usually develop in patches of the same shape and size on both sides of the body. Chronic bullous dermatosis: a disease that causes clusters of blisters on the face, mouth or genitals. Cutaneous radiation syndrome
Epidermolysis bullosa

Pathophysiology
Friction blisters
Friction blisters are caused by excess shear stress between the bottom and surface of the skin and the body. The strata of skin around the stratum spinosum are most susceptible to shear. As the stratum spinosum tears away from the connecting tissues below, plasma from the cells diffuses out.