How do nebula form stars? If all the hydrogen is already fused by the dead star. how are new stars are born with a fresh supply of hydrogen?

Only in stars' cores or in the layers surrounding them, where temperatures and pressures are high enough, do fusion reactions occur.

When a massive star reaches the end of its life, its core is still hydrogen rich and contains heavy elements, mostly iron. Fusion reactions that produce energy cannot occur in the core any longer, and the star collapses under gravity to form a black hole or neutron star.

A nebula is created when the outer layers rich in hydrogen are blasted away by a supernova explosion brought on by the core collapse.

Thus, enough hydrogen is frequently still present to form a new star.

Space is home to regions known as nebulae, which are collections of gas and dust that are brought together by gravity to form denser regions known as protostars. Eventually, the pressure and temperature inside a protostar's core rise to a point where nuclear fusion can take place, converting hydrogen into helium. Although some of the hydrogen in the universe has been used up by earlier star generations, a vast reservoir of hydrogen remains in the universe, replenished by processes such as stellar winds and supernova explosions, allowing new stars to be formed from the hydrogen contained in nebulae.