Significance of Mahashivaratri

Mahashivaratri  is the day dedicated to Lord shiva and also is referred as the great night of Shiva. It falls on the 14th day of the dark fortnight of Phalguna (February- March). This festival is purely religious in nature and universally observed by all Hindus. On this day devotees sing bhajans in honor of Shiva, recite Sanskrit shlokas (verses) from scriptures, offer prayers in the morning and evening, and some observe fasting throughout the day. People visit nearby temples of Shiva and offer prayers in large crowds. The prayers and worship continue late into the night when the devotees offer coconut, Bilva leaves, fruits, and specially prepared sacred food to Shiva and his divine consort Parvati. Offering Bilva leaves to Shiva on Shivaratri is considered very auspicious by his devotees. One who have Linga at home also undergo prayers and do abishek to Linga with fruits, milk, curd, rose water, and flowers chanting the panchakshara mantra of Lord Shiva with all serenity.

Mahakaleswar Jyotirlin, Madhya Pradesh

There are sevaral legends in Hindu mythology attributed to mahashivarathiri. 

Ocean Churning:

One very popular story traces the origin of this festival to the churning of the Ocean of Milk by devas (gods) and asuras (demons). It is said that when both gods and demons were churning the Ocean of Milk to obtain amrita (water of immortal life), they came across many unusual substances, including the deadly poison Kalakuta. As soon as they touched the poison, it exploded into poisonous fumes that threatened to envelope the entire universe by darkness. When the destruction of the universe seemed inevitable, the gods ran for assistance from Brahma and Vishnu, but neither was able to help. At last they ran to Lord Shiva, who raised his trident and condensed the fumes. 

Lord Shiva swallowing the poison

In order to save the creation, Shiva swallowed the poison without spilling a single drop. The poison left a dark blue mark on Shiva's throat. The gods praised and worshipped Shiva for saving the universe.Every month witnesses a day with Sivarathiri thithi. But Maha Sivaratri happens once a year and is celebrated in reverence to Lord Shiva. Sivarathiri literally means the night of Lord Shiva. This day, is celebrated on the moonless night of the month of Phalguna (Maasi in tamil), which is the fourteenth day in the krishnapaksha or dark half. Owing to a special planetary conjunction, spiritual practices done on this day are considered to be especially auspicious and beneficial. It is believed that in one of the Puranas(legends), Lord Shiva himself tells Parvati Devi that this day is very dear to him, and that those who perform the prescribed austerities on this day will be freed from all sins.

Somathaswamy Jothirlin, Somnath

One of the story behind Sivarathiri from Garuda Purana:

There was once a hunter from Varanasi named Suswara who lived with his wife and child in a small hut. Theirs was a hand-to-mouth existence. Suswara would go to the forest and hunt whatever game came his way, and thus feed his family. One particular day,The day before the new moon, while roaming through forests in search of animals, he saw a deer, but before his arrow flew he noticed the deer's family and their sadness at its impending death. So he let it live. He had still not caught anything when he was overtaken by nightfall.He was a little worried as the forest was infested with dangerous animals. He did not like the idea of spending the night there. Soon it became very dark. Unable to find his way back, Suswara took shelter on a tree to be safe from the wild animals.

Suswara was unable to get even a wink of sleep. He kept vigil throughout the night. To pass away the time he engaged himself in plucking the leaves of the tree and dropping them down onto the ground. The next day he returned home and bought some food for himself and his family. The moment he was about to break his fast a stranger came to him, begging for food. He served the food first to stranger and then had his own.

Unknown to Suswara, there was a Shivalinga at the foot of the tree; and moreover the tree he had taken shelter was Vilva or Bilva tree. By dropping the sacred bilva leaves, Suswara was making a sacred offering to the Shivalinga. That night happened to be Shivaratri. So the hunter had unknowingly kept a night-long vigil and worshipped Shiva.

How to worship Shivarathiri?

As by Shiva Purana, the Maha shivaratri worship or prayer should incorporate six items: 

1. offering bilva leaves to the deity after giving it a ceremonial bath, which represents purification of the soul; 
2. applying vermilion paste on the linga after bathing it, which represents virtue; 
3. offering food, which is conducive to longevity and the gratification of desires; 
4. lighting incense, which yields wealth; 
5. lighting an oil lamp, which signifies the attainment of knowledge; 
6. and offering betel leaves, which marks satisfaction with worldly pleasures. These six items form an indispensable part of the Maha shivaratri worship, be it a simple ceremony at home or grand temple worship.

Also look at:

1. Significance of Bilva leaves and Bilvastakam
2. What to chant on Sivarathiri?

Om Namasivaya ~~~ Om Namasivaya ~~~ Om Namasivaya ~~~ Om Namasivaya ~~~ Om Namasivaya