The Chinese new year is now popularly known as the Spring Festival because it starts on the beginning of Spring. In Chinese, "year" - Nian, was originally the name of a monster beast which preys on people at night before the beginning of a year.
One legend goes that the beast, Nian, had a very big mouth that could swallow a people with one bite. People were terrified of it. One day, an old man came to their rescue, by offering Nian, "I hearsay that you are very capable, but can you swallow the other beast on Earth instead of people who are by no means of your worthy opponents. "From then Nian preyed on beasts on the earth that also harassed people and their domestic animals.After that, the old man disappeared riding the beast Nian. The old man turned out to be an immortal that's supposed to get rid of Nian and other beasts of prey into the forests.The people began to enjoy life. Before the old man left, he told the people to put up red paper decorations on their window at each year's end to scare away Nian in case it came back again, because red is the colour it feared most.
The other version goes that the beast Nian would emerge from the mountains and prey on people on the eve of every new year.Then, an old man said that Nian was afraid of loud noises and the colour, red. Hence, before its arrival on the eve of the new year, people put up red paper on their doors and windows. When the beast arrived, everyone would start to hit drums, pots, light fire crackers to scare it away. This ingenious ploy did its trick, and Nian did not appear anymore. This heralded the beginning of red paper decorations, lighting of fire crackers and the lion dance during Chinese New Year.

Significance:
CNY (Chun Jie) symbolises the beginning of the year, a fresh start in one's life. It also symbolises fresh hopes for happiness and prosperity among mankind. Chinese New Year is a time to renew and reaffirm family and kinship ties. It is also a time to resolve disputes and grudges. CNY activities like reunion dinners, visits among relatives and friends and the exchange of gifts serve to remind the Chinese of the central position the family occupies in the society.


Observances:
1. After dinner on the eve, one is not supposed to sweep anything out of the house. If one has to sweep anything, he or she would have to sweep it in. This is done so good luck will not be swept away.
2. If someone breaks anything, he or she would have to utter (Sui Sui Ping An /岁岁平安 ) or (Hua Kai Fu gui /花开富贵 ) which means "peace every year" and prosperity after the arrival of flower blooms.
3. Bad, vulgar or unpleasant topics are to be discouraged.
4. Debts are to be settled before the arrival of the new year.
5. All visitors are not encouraged to wear black because black is deemed to by inauspicious.
6. All relatives gather at their grandparents house for reunion dinners.
7. There will be an exchange of mandarin oranges when they visit as a sign of respect and greeting.
8. Red packets(ang paos) are given by married people to non-married people.
9. Yu sheng is tossed during reunion dinners to signify wealth and prosperity.
10. New clothes are worn during the new year.

Acknowledgments:
http://www.huayinet.org/culture/sitemap_culture_festivals_chunjie.htm
http://www.geocities.com/Paris/Parc/1486/festival/cny.html
http://www.educ.uvic.ca/faculty/mroth/438/CHINA/chinese_new_year.html
http://www.indiana.edu/~chasso/holiday.html
http://myweb.gettinghere.com/country/phil/event.cfm
http://www.rice.edu/projects/topics/internatl/holidays/new-years-page1.htm
http://www.google.com.sg/