The festival of lights
Diwali is traditionally known by the name of the 'festival of lights", for the common practice is to light small oil lamps (called diyas) and place them around the home, in courtyards, gardens, verandahs, on the walls built around the home and also on the roof tops। There are whole lots of Diwali customs and traditions associated with the festival of Diwali in India, which make this festival worth celebrating।
The Diwali customs and traditions are diverse and there are a lot many legends associated with the celebrations of Diwali।
Goddess Lakshmi : The Goddess of wealth, Lakshmi was incarnated on the new moon day (amaavasyaa) of the Kartik month during the churning of the ocean (samudra-manthan), hence the association of Diwali with Lakshmi.
Vishnu Rescued Lakshmi: On this very day, Lord Vishnu in his fifth incarnation as Vaman-avtaara rescued Lakshmi from the prison of King Bali and this is another reason of worshipping Ma Larkshmi on Diwali.
Krishna Killed Narakaasur: On the day preceding Diwali, Lord Krishna killed the demon king Narakaasur and rescued 16,000 women from his captivity. The celebration of this freedom went on for two days including the Diwali day as a victory festival.
The Return of the Pandavas: According to the great epic 'Mahabharata', it was 'Kartik Amavashya' when the Pandavas appeared from their 12 years of banishment as a result of their defeat in the hands of the Kauravas at the game of dice (gambling). The subjects who loved the Pandavas celebrated the day by lighting the earthen lamps.
The Victory of Rama: According to the epic 'Ramayana', it was the new moon day of Kartik when Lord Ram, Ma Sita and Lakshman returned to Ayodhya after vanquishing Ravana and conquering Lanka. The citizens of Ayodhya decorated the entire city with the earthen lamps and illuminated it like never before.
Coronation of Vikramaditya: One of the greatest Hindu King Vikramaditya was coronated on the Diwali day, hence Diwali became a historical event as well.