This article is about the Chinese Ghost Festival. For the festival in Loei province, Thailand, see Pee Ta Khon.

The Ghost Festival (Traditional Chinese: 中元節 pinyin: zhong1 yuan jie) is a traditional Chinese festival/holiday, which is celebrated by Chinese in many countries. In the Chinese calendar (a lunisolar calendar), the Ghost Festival is on the fifteenth day of the 7th lunar month.

In the Chinese tradition, the 7th month in the Chinese calendar is called the Ghost Month (Traditional Chinese: 鬼月), in which ghosts and spirits come out from the lower world to visit earth. The Ghost Festival is the climax of a series of the Ghost Month celebrations. Activities at the festival include preparing ritualistic offering food, and burning Spiritual Money (or paper money) to please the visiting ghosts and spirits as well as deities and ancestors. Other activities include burying and releasing miniature paper boats and lanterns on water, which signifies "giving directions to the lost ghosts". A very solemn festival, the festival nevertheless represents a connection between the living and the dead, earth and heaven as well as body and soul.

The Ghost Festival has roots in the Buddhist festival, Ullambana, and also some from the Daoist culture. In the Tang Dynasty, the Buddhist festival "Ullambana" and traditional festivities were mixed and celebrated on one day. Thus, the Ghost Festival has special meaning for all Buddhists as one of their most important festivals.

The Buddhist origins of the festival can be traced back to a story that originally came from India, but later took on culturally Chinese overtones. This story, "Mu-lien Saves His Mother from Hell", is an account of a well-to-do merchant who eventually gives up his trade to become a devout follower of Buddhism. After he attains enlightenment, he thinks of his father and mother, and wonders what happens to them. He travels over the known Buddhist universe, and finds his father in heaven. However, his mother has been sent to hell, and has taken on the form of a hungry ghost (餓鬼)--it cannot eat because its throat is very thin and no food can pass, yet it always hungers because it has such a fat/large belly. His mother was greedy with the money he left her. He had instructed her to kindly host any Buddhist monks that ever came her way, but instead she withheld her kindness and her money. It was for this reason she was sent to hell. Mu-lien eventually saves her from this plight by battling various demons and entreating the help of the Buddha. The compromise that was made was one that owes to the relevance of the Ghost Festival and "Ancestor Worship". The Buddha instates a day after the traditional summer retreat (the fifteenth day of the seventh month in the lunar calendar--usually mid-to-late August) as a day of prayer and offering in which monks can pray and make sacrifices on behalf of dead ancestors or hungry ghosts. The family members of the deceased essentially pay for this service, and thus their patronage is a form of charity. The deceased ancestors are pacified and hungry ghosts can eat (the sacrificial foods). The Mu-lien story ends with this festival and the rescue of his mother from hell. She ends up being reborn as a dog, but as a pet in a well-off household.

See also: Ancestor worship