What is the nature of the universe and how can I distinguish reality from illusion?NO
This is a very knotty question to answer. This is the sort of question great philosophers have debated for thousands of years without reaching an agreement.
There is a philosophical and scientific view that the each one of us the world exist the way we perceive it. For example, i have no way of knowing that sugar tastes to me same way as it tastes to you. When we eat sugar the sensation we feel may be quite different. So the there is no objective reality of the taste "sweet". It is just something perceived by individuals. Similarly when we see a big building, it is just some rays coming and striking the retina of our eyes. And eve these rays are just some waves or disturbances in a hypothetical medium called "ether" which pervades the entire universe, even the vacuum in the space. So this ether itself is nothing but emptiness, and some wave like disturbances cause some disturbances in retina of our eve, that again get converted in disturbances in our optical nerves, and these are interpreted by our brain as a building. So the building we see is only a perception in our mind.
Based on the kind of observation and logic described above, some philosophers conclude that this world is only an illusion. How do we distinguish the reality from illusion. By realizing that this world is an illusion. What we see in dream is a reality as long as we are asleep, as soon as we wake up, we realize the falsehood of dream and the dream vanishes. But in case of reality of the world, the perception of the world does not cease. You just realize that it is illusion. We can compare this situation with watching a trick of magic. When we watch the magic we are intrigued by it, and we wonder how did this happen. But when we realize the trick of the magician behind the magic, we know that what we see is not what is really happening. But physically, there is no difference in what our eyes see. The difference is only in our understanding. When this understanding or realization comes, I am told, we mentally say "Ah! this is just an illusion." but the illusion is still there. Everything you perceive is an illusion. The only reality is your realization of this illusion.