Puffballs belong to a group called Gasteroid fungi that lack an open cap with spore-bearing gills. Instead, spores are produced internally, in a spheroidal fruiting body as a fleshy mass that changes to powdery, water repellent spores. A hole often usually forms in the skin at the top, and pressure from raindrops causes the pores to puff out and disperse. The skin can split to reveal a powdery mass that can end up as a soggy mess.
Many are edible at the firm stage. When I was at uni I had a great mycology (fungi study) lecturer who showed us the edible fungi in the suburbs. Much to my mother’s horror I picked a heap of white puffballs from the front lawn then sliced and fried them. The taste was nothing special but I was unaffected.
False truffles belong to another group that produce underground fruiting bodies that emit a smell that attracts small marsupials like woylies. They dig them up and eat them and spread the spores in their dung. There are no woylies left in Foxes Lair, but I have recently seen similar groups of holes that must have been dug by kangaroos.
The images below show a large puffball with stages of spore release.