Parasitic wasp larvae hatching from inside the living caterpillar host. The
female wasp will oviposit into the host’s body. The larvae will feed
inside the host until they are ready to pupate. Quite often the host is
dead by that point but if not, then the parasitoid will often eat its
way out of the host.
This hawk moth (most likely a Violet Gliding Hawk Moth (Ambulyx liturata, Sphingidae)) has been parasitized by an Akanthomyces fungus (probably Akanthomyces pistillariiformis), a Cordyceps anamorph peculiar to moths.
After killing the moth, the fungus then totally engulfs and embalms the corpse producing this macabre sight. (An entomopathogenic fungus is a fungus that can act as a parasite of insects and kills or seriously disables them.)