The seventh month of the lunar calendar marks the Mid-Year Festival, or Zhong Yuan Jie 中元节. It is better known as the Hungry Ghosts Festival, lasting for a whole month, during which the gates of hell are opened for ghosts to enjoy a month-long holiday.

Buddhists celebrate the Hungry Ghosts Festival as the Yu Lan Pen 于兰盆. This festival commemorates Mu Lian 目莲 for his filial piety. Mu Lian's mother was a pious vegetarian with an acute illness. One day, Mu Lian offered meat-soup to his mother, who unknowingly drank it and was cured of her illness. When Mu Lian told her about the truth, she denied taking the meat, declaring that she be cast into the deepest hell if she took meat. Immediately, she went to hell. Mu Lian offered to take all the punishment, in order to save his mother. Just as he was placed in a cauldron about to be sacrificed, Buddha came to his rescue. After many trials and tribulations, Mu Lian located his deceased mother with the Hungry Ghosts. When he tried to feed his mother, other Hungry Ghosts greedily grabbed the food. Once when his mother ate some rice, the rice in her mouth turned into fire. Following Buddha's directions, Mu Lian freed his mother from the sufferings by offering special prayers and food on the 15th night of the 7th month. Since then, the Chinese have repeated this practice for their own ancestors.

To placate the Hungry Ghosts (restless spirits due to various reasons), humans make offerings of joss-sticks, food and joss paper (spirit money) at every roadside, cross-roads, temple and other open spaces. Makeshift tents housing altars are also built, with giant colourful joss-sticks. These places stage street theatres (wayangs), and puppet shows for the ghosts.
The Buddhists also believe, that the dreaded Hungry Ghosts are on the prowl especially on the 15th day of the seventh month. To appease them and send them on their way, food, paper gifts, money and other items are offered and burnt.
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