'Hana' means flowers and typically refers to cherry ('sakura' in japanese). The Hanami party is the celebration of the blossoming of the cherry flowers. This event celebrates the transient beauty of the flowers and marks the blossoming period of cherry flowers.
The cherry flowers have a very short blossoming period, lasting about two weeks. The blossoming season starts towards the end of march and lasts till the first week of april, in major Japanese cities of Tokyo, Kyoto and Osaka. The other regions of Japan may observe Hanami at slightly different times.
The cherry flower blossoming is celebrated with outdoor picnics or parties under the blossoming trees, typically in afternoon or at night. The Hanami party traces its existence to the Nara Period (710-794 AD). An ancient form of Hanami celebrates the blossoming of plum flowers.