This is the festival of colors. People throw colors on each other in happiness and renewing friendship. People who have not seen each other for one full year go to them now, at least once a year.

This day is commemorated in the remembrance of Prahlaad and Holikaa (his father's sister). A large heap of wood and trees branches is prepared on many crossroads and at a definite time the fire is set to this heap. Women who have sons, go to worship the Holee heap and pray for the protection of their sons like Prahlaad.

Next day  at the time of setting fire, men and boys come and add some more woods and cow dung to this heap. They roast a few plants of their newly grown barley plants too in this fire. Then they go to greet their relations and friends and exchange a few grains of those barley plants. There they eat sweets and play Holee with various types of colors - dry, wet, sticky any kind of thing is allowed on this day. 

This continues till about noon. Then they take bath and clean themselves, take special food, many times with relations and friends. In the evening they go to meet their distant friends who they could not see in the morning.

This day is considered very auspicious for renewing friendships and forgetting everything malicious about anybody in the past. People do not mind welcoming their old enemies and renew their friendship.

Its story goes like this:

There was an Asur King Hiranyakashyap. He was so mighty that he thought himself as God. He was so obsessed with his pride that he told his people not to worship God, but to worship him only.

He happened to have a son, named Prahlaad. He was a great devotee of God, and he was so great devotee that he used play only God games with his friends. When Hiaranyakashyap heard this, he got very angry, and he sent him to a Guru and asked the Guru to teach him proper manners.

Now Guru tried his best to teach Prahlaad his father's teachings, but he wouldn't listen. When Hiranyakashyap heard this He got very angry. He again tried to explain him everything, but Prahlaad always said God is the greatest. When Hiranyakashyap failed to make him agree with him, he thought he should be killed.

He asked his men to roll him down from a mountain, but by the Grace of God Prahlaad came back safe and sound. Next time He asked his men to shut him in the oven of a Kumhaar (earthen pots maker). The fire lost its heat and Prahlaad once again came back safe and sound. Next time he ordered his men to leave him with lots of hungry serpents. But later he was found playing with them.

Now Hranyakashyap had a sister named Holikaa. She had a boon that she would not burn in fire. He thought if Holikaa will sit with him in the fire, then Prahlad will burn and Holika will come out unhurt. He requested Holikaa to do that. Holikaa readily agreed up on this. So in an open space a large heap of woods, tree branches, or any other material which could be burned was prepared. At a definite time Holikaa took Prahlaad in her lap and sat on the heap smiling. The fire was set, and Lo, Holikaa was burned and Prahlaad came out singing Raam's praise.

Thus this process of burning a lots of woods etc is called as Holika-Dahan too.

In Uttar Pradesh, Holee of Brij area (Mathuraa, Vrindaavan, Gokul etc.) is very famous - Barsaaney Kee Holee. There Raadhaa and other Gopee used to play Holee with Lord Krishn.