Lanterns have been part of Chinese culture for centuries and play an important part in many celebrations. In ancient times, there were mainly three kinds of lanterns
Palace lantern
It was mainly used in palaces in ancient times. When making palace lanterns fine wood was used. The palace lanterns were covered with silk or glass. Different kinds of pictures were drawn on the covers. These lanterns were not only used as lights but also as decorations (装饰) in palaces.
Gauze lantern (纱灯)
Less expensive bamboo and gauze were used to cover the lantern. Red gauze was used when making them. In Chinese culture, red lanterns stand for (代表) happiness. So red lanterns are always hung (悬挂) on important festivals such as Lantern Festival, Spring Festival and National Day in parks or along main streets. In some famous Chinatowns abroad, you can see red lanterns all the year round. They have become a symbol of Chinese culture worldwide.
Shadow picture lantern (走马灯)
It was usually used for amusement (娱乐) .The shape was much like that of the palace lanterns. There were two layers (层) of covers and pictures were drawn on the inside layer. When lit (被点燃) ,the heat caused a paper wheel inside the lantern to turn around, so that moving pictures appeared on the outside cover.
Now more kinds of lanterns appear in festivals besides the traditional ones. More modem technology is used on making lanterns. The shapes of the modem lanterns have changed a lot too.