First, let's take a look at some information we'll need to think about this question. Everything in the world is made up of atoms. These atoms clump together to make molecules, and these make up the usual objects we see in everyday life, such as chairs, computers, water, and even humans. Even though we can't see it, air is also made of molecules. The more molecules of gas there are, the more space it will take up.

When someone blows up a balloon, the initially empty balloon fills up with gas molecules that were inside the person's lungs. These molecules take up some space and cause the balloon to stretch out. When you release the air from the balloon, all of those gas molecules get mixed together with the rest of the gas molecules in the outside air. Because the molecules that make up the gas aren't in the balloon anymore, there is nothing to stretch out the sides of the balloon, and it looks empty!

The "space" in the balloon is caused by the containment of the air that you force into a very small area by blowing into the balloon.So there are a bunch of molecules bouncing around in there leading to the balloon growing in size. When you release the air, it can spread throughout the area around you, which is MUCH larger than the space inside the balloon so you cannot really see it.