A wall cloud is created as a large lowering under the rain-free base of the updraft of a storm. According to the provided reference, a wall cloud can be rotating and potentially tornadic, or non-rotating, posing little threat of producing a tornado.
In essence, a wall cloud forms due to the interaction of warm, moist air rising into a thunderstorm (the updraft) and cooler, drier air being drawn into the storm at the mid-levels.