When Harry receives the Invisibility Cloak for Christmas, it is described as fluid, shining and silvery gray (emphasis mine):
This only left one parcel. Harry picked it up and felt it. It was very light. He unwrapped it.
Something fluid and silvery gray went slithering to the floor where it lay in gleaming folds. Ron gasped.
"I've heard of those," he said in a hushed voice, dropping the box of Every Flavor Beans he'd gotten from Hermione. "If that's what I think it is — they're really rare, and really valuable."
"What is it?"
Harry picked the shining, silvery cloth off the floor. It was strange to the touch, like water woven into material.
"It's an invisibility cloak," said Ron, a look of awe on his face. "I'm sure it is — try it on."
-Harry Potter and the Philosopher's Stone, Chapter 12, The Mirror of Erised
This leads me to the question, why is an Invisibility Cloak seen? Shouldn't it be by definition invisible? Or does it work in the way that it's only invisible when someone wears it but not at other times?