This is a cotton like cloud I painted in 2013 following Steven Stahlberg's cloud tutorial. Below are screenshot of my progress. Keep in mind that this is not a detail tutorial, but should give you a clear view on how layering can help on painting clouds.
Paint the base sky color, I choose a cyan gradient.
Draw the countour / shape of the cloud. A scattering round brush would help on the smaller details. Or you can just use a custom brush.
Lock the layer transparency and paint darker shade of color near the edge of cloud which slowly fade to a brighter shade in the middle. A "texture/rough" blending will work better than a smooth blending.
Add another layer, draw another cloud shape which are slightly smaller than previous layer.
Apply the same shading technique, cloud edge shade with darker color and fade to brighter color in inner part.
Add another layer again and repeat the same steps.
Repeat again and again until.
Final step! Add another layer behind everything, paint those soft blur puffy cloud.
ArtworkThe shape of the clouds are not that good due to my skill. But this shading method definitely produce more realistic cloud.
Another try with cloud layers. This time using brighter color on the edge, and paint it with less detail.
ReferenceSteven Stahlberg's cloud tutorial
Deviantart Cotton Cloud
Deviantart Cumulus Cloud