Obon is a Japanese Buddhist holiday custom where you honour the spirits of you ancestors. It is held in summer and people return to their home towns to visit the graves of their loved ones and departed relatives.
Graves are cleaned,incense are burned, flowers are placed on graves and people pray to their ancestors. It is also a time where they visit family household shrines. It is a time to reflect on the departed, a time when the deceased supposedly revisit the the household shrines and has been celebrated for more than 500 years.
It lasts for three days but the starting date of the festival varies in different regions of Japan. When Japan adopted the Gregorian calendar in stead of the traditional Lunar Calender it resulted in three different times for Obon: ‘Shichigatsu Bon (Bon in July and celebrated round 15 July in Eastern Japan) Hachigatsu Bon (Bon in August and celebrated around 15th of August) and Kyu Bon (Old Bon, celebrated on the 15th day of the seventh month of the Lunar calendar, and it differs each year)
These three days are not public holidays but it is customary that people are given leave.
Because Obon is celebrated in summer, yukata or light kimonos are worn traditionally. The festival ends with Toro Nagashi (The floating of lanterns) when paper lanterns are illuminated and floated down rivers which symbolically mirrors the return of the ancestral spirits to the world of the dead.
To read more on this fascinating celebration, please read the following: http://goo.gl/mLWeOI