The Water-splashing Festival is the most ceremonious and characteristic festival of the Dai people. In fact, it is New Year in Dai calendar, equal to the Spring Festival for Han people. It is called the Water-splashing Festival because during the festival days, people splash water to each other for good luck.

The Water-splashing Festival is celebrated in April (June by Dai calendar) every year. It is just before ploughing and rice seedling planting. People enjoy themselves and wish each other good luck, in order to send off the old year and welcome the new one, and to impetrate Sakyamuni and heaven gods to endow good harvest and a flourishing population. The festival usually lasts three to four days. The first day is called "Wanduoshanghan" in Dai, meaning the New Year's Eve. In the morning, after getting their bodies washed and clothes changed, all the people, from young to old, go to see such activities as dragon boat race and firing Gaosheng (a kind of homemade rocket played for celebrations), etc. The second and third days, called "Wannao" in Dai, usually have no activities. The last day is "Wanbawanma" in Dai, meaning "the day King of Days comes". On that day, people get up early and carry offerings to Buddhist temples. They listen to the Buddhism preaching, and clean the Buddhist josses, begging them to render health, harvest and happiness in the coming year. Afterwards, in the sound of Elephant-foot drums and Mang gongs, they splash water to express their best wishes to each other, all crying "water, water, water!" It is not rude to splash to the elder, and blessing words should be said at the same time. However, it is completely free of rules between youngsters. They like chasing and frolicking while splashing fiercely with basins and buckets of all size, because water splashing is a kind of blessing, and the more water you are splashed, the more lucky you are. There is a popular Dai saying: "At the Water-splashing Festival each year, splash whoever you think worthy."

There is beautiful story about the origin of the Water-splashing Festival. Long ago, there was a devil in the place where the Dai people lived, doing all kinds of evil. All the people hated him to the extremity, but had no method to punish him because of his powerful magic. Then one day in June by Dai calendar, his seventh wife, who had been robbed from the village, fuddled and induced him to speak out his own weak points. When he was sound sleeping, the seventh wife and the other sisters together used his hair to cut off his head. But once the head touched the ground, it began to burn fiercely. So the girls rushed over bravely to pick up the head and hold it in arms tightly, and the fire died out immediately. Therefore, the seven girls took turns to hold the head, each for one year. Every year at the time of changing turns, people would splash water on the girl who has held the head for a whole year, to wash away the blood on his body and the one-year fatigue. By and by, it developed into a happy festival to send off the old year and welcome the new.