What events took place in our Solar System which led to formation of the Earth? I have heard from sources that a big giant star exploded and the Earth was formed. Is this true ?
The following quote from Birth of the Earth explains the current theory/model for the formation of the Solar System:
Long, long ago (some 5 billion years ago) in a perfectly ordinary place in the galaxy, a supernova exploded, pushing a lot of its heavy-element wreckage into a nearby cloud of hydrogen gas and interstellar dust. The mixture grew hot and compressed under its own gravity, and at its center a new star began to form. Around it swirled a disk of the same material, which grew white-hot from the great compressive forces. That new star became our Sun, and the glowing disk gave rise to Earth and its sister planets. We can see just this sort of thing happening elsewhere in the universe.
Read this article from Wikipedia as well.