While most Americans are busy putting away their Halloween decorations, one of Mexico's most important holidays is just beginning: Day of the Dead (or Dia de los Muertos). From October 31 - November 2nd, families in Mexico pay tribute to departed loved ones with a festival of flowers, food, and music.
During this time, spirits are believed to return to their homes to visit with family and friends. In preparation for this day, both children and adults spend weeks preparing special foods, creating altars in their homes, and decorating grave sites.
Whatever your nationality, a Day of the Dead party is a great way to gather your loved ones (both living and dead) for a meaningful celebration. Here's how:

Decorations
Your altar will serve as the central element of your décor (see "activities" below for instructions). Surround it with paper flowers, votive candles, and photos of deceased relatives. Burn incense to welcome the spirits.

Arrange whimsical skeleton figurines on your altar or fireplace mantle, or hang Halloween skeletons around the party room.

Place vases full of flowers - especially marigolds - all around your house.

Food & Drinks
Prepare an authentic Mexican feast.

For dessert, serve skull-shaped sugar candies and Pan de Muertos, a coffee-cake like confection made especially for Day of the Dead.

Activities

Have guests bring symbols or photos of the dead and build an altar together.

1. Set a table against a wall.
2. Place books or empty boxes on the table to create different levels and cover with a cloth (the levels represent the stages spirits go though to reach Paradise).
3. Add flower petals and garlands, a glass of water, candles, and incense. (These items represent the elements: earth, water, fire, and air.)
4. Place photos of the dead on the altar, along with any food or drinks they enjoyed while they were alive. (This is to welcome the spirits to the party.)

After the altar is complete, enjoy the celebration!

Adapted from GreatEntertaining