Often overshadowed by the two days preceding it, Halloween (October 31) and All Saints Day (November 1), All Souls Day is a solemn feast in the Roman Catholic Church commemorating all of those who have died and now are in Purgatory, being cleansed of their venial sins and the temporal punishments for the mortal sins that they had confessed and atoning before entering fully into Heaven.
The importance of All Souls Day was made clear by Pope Benedict XV (1914-22), when he granted all priests the privilege of celebrating three Masses on All Souls Day: one, for the faithful departed; one for the priest's intentions; and one for the intentions of the Holy Father. Only on a handful of other very important feast days are priests allowed to celebrate more than two Masses.
While All Souls Day is now paired with All Saints Day, which celebrates all of the faithful who are in Heaven, it originally was celebrated in the Easter season, around Pentecost Sunday (and still is in the Eastern Catholic Churches). By the tenth century, the celebration had been moved to October; and sometime between 998 and 1030, St. Odilo of Cluny decreed that it should be celebrated on November 2 in all of the monasteries of his Benedictine congregation. Over the next two centuries, other Benedictines and the Carthusians began to celebrate it in their monasteries as well, and soon it spread to the entire Church.
On All Souls Day, we not only remember the dead, but we apply our efforts, through prayer, almsgiving, and the Mass, to their release from Purgatory. There are two plenary indulgences attached to All Souls Day, one for visiting a church and another for visiting a cemetery. (The plenary indulgence for visiting a cemetery can also be obtained every day from November 1-8, and, as a partial indulgence, on any day of the year.) While the actions are performed by the living, the merits of the indulgences are applicable only to the souls in Purgatory.
Praying for the dead is a Christian obligation. In the modern world, when many have come to doubt the Church's teaching on Purgatory, the need for such prayers has only increased. The Church devotes the month of November to prayer for the Holy Souls in Purgatory, and participation in the Mass of All Souls Day is a good way to begin the month.