One of the most popular festivals in Odisha, primarily because of the ritual of smearing friends and family members with colours. Holi has a long tradition and legend associated with. According to popular legend Holi celebrates the victory of Lord Vishnu over Hollika, the sister of demon King Hiranyakashyap. The story goes something like this, despite repeated attempts Hiranyakashyap couldn't kill little Prahlad, so he designed a sinister plan and summouned for his sister Hollika. The plan was to entice Prahlad to sit on Hollika's lap as she sat on fire, Prahlad being a little boy will burn to his death but Hollika who has been blessed by a boon wherein she cannot get burned or get drowned will escape unscathed. The sinister plan didnt go unnotice from Lord Vishnu whose ardent devotee was Prahlad. As Hollika sat on the fire with Prahlad who kept chanting Lord Vishnu's name, the Lord Visnhu came to the rescue and ensured Prahlad came away safe while Hollika burnt to her death- as her boon had a condition, the fire wont harm her if she entered alone. So Holi is celebrated as a festival of good over evil.
In Odisha its a five day long festival which starts on Phagu Dasami (sometime in March) and ends on Dola Purnima.
On this day the Odia calender for the year is also ready and presented to Lord Jagannath who assumes the form of Dolagobinda and devotees smear him with colours on all the five days. The festival ends with a procession of palanquins carrying idols of Lord Krishna going through the streets and meeting at a common place.
The festival also marks the end of winter and beginning of spring. The Gulal (red powder) used to smear friends and family members with, actually helped clear dead skin cells which had accumalated during the winters. However nowadays with chemicals and artificial dyes being used in the colours, its best to take proper precaution while playing Holi.