Question
I have something growing on my azalea leaves it is green and puffy like some kind or cacoon

Answer
Sounds like you are describing Azalea leaf gall.  This is a fungal disease that will not kill your plants, but makes the leaves look distorted.  All of the galls are on the terminals of branches and are light green and maybe with a white powdery covering on them.  They are fleshy now but will turn hard and black with time.  The only control is pulling them off by hand and putting them in the trash so they dont hang around and spread the disease next year.  Fungicides can be applied at first bud break in the spring.  Daconil is a good choice for this.  It is too late for this year as the disease has almost completed its cycle.  Just pull the galls off and throw away for now.  The fungicide can be applied next spring as the disease will appear year after year if nothing is done.  I hope this helps.  Thanks.