Invisibility

Invisibility is a Status Effect which makes a player temporarily invisible to other Players or Mobs. Visually, this status effect only affects the base character model. Any Armor that is worn or items being held by the user are still visible to other players. Despite this, mobs will still have a harder time detecting a player than normal. However, for every piece of armor worn, it lessens the effectiveness of the invisibility effect, and mobs will be able to detect a player more easily as more armor items are equipped.

Like all status effects, it can be removed by drinking Milk.

Source

This status effect can be gained from two sources:

• Potion of Invisibility
• Arrow of Invisibility

Trivia

• The particle-effect animations are still visible, even if a player is invisible.
• While invisibility allows a player to be virtually undetected, this effect does NOT exclude a player from damage due to mob attacks, fall damage, etc.
• Complete invisibility can be obtained in Console editions if host privileges are enabled, and the host enables invisibility. However, this type of invisibility prevents a player from destroying blocks and a player is completely invisible to other players even if they have armor on.
• If a spider is invisible, its eyes will still be visible. The same effect happens with enderman. 
  • Blaze's smoke particles, mooshroom's mushrooms, and a charged creepers charge will be shown. So will any armor or tools that the mob has. (Bows, swords, axes, etc.)