Loi Krathong takes place on the evening of the full moon of the 12th month in the traditional Thai Lunar calendar. In the western calendar this usually falls in November.
Loi literally means ‘to float,’ while krathong refers to the lotus-shaped receptacle which can float on the water.
Originally, the krathong was made of banana leaves or the layers of the trunk of a banana tree or a spider lily plant. A krathong contains food, betel nuts, flowers, joss sticks, candle and coins. Modern krathongs are more often made of bread or Styrofoam. A bread krathong will disintegrate in a few a days and be eaten by fish and other animals. The traditional banana stalk krathongs are also biodegradable, but styrofoam krathongs are frowned on, since they are polluting and may take years to disappear. Regardless of the composition, a krathong will be decorated with elaborately-folded banana leaves, flowers, candles and incense sticks. A low value coin is sometimes included as an offering to the river spirits. During the night of the full moon, Thais will float their krathong on a river, canal or a pond lake.
The festival is believed to originate in an ancient practice of paying respect to the spirit of the waters.
above details taken from this LINK.