There are different mythological stories about why Diwali is celebrated. One story is of Lord Krishna killed a demon called Naraka. In North India, the story is of Lord Ram returning back to his kingdom after his exile & he killed the demon Ravana.
On Diwali, we get up at 4 a.m. or even earlier & our mother would apply oil on our heads & then we take a shower & wear new clothes. We burst fire crackers (fireworks). Some people pray to Goddess Lakshmi, the Goddess of Wealth. All together it is the good triumphing over evil.