Just found this amazing video over at Neat-o-rama, detailing the lantern launching ceremony that goes along with the Chiang Mai Yi Peng Festival. This from the site:
"The Chiang Mai Yi Peng Festival is an Buddhist holy day in Thailand. That evening, celebrants send send burning lanterns aloft, floating on hot air. According to YouTube user bugzila:
[...]it is the great festival of Lanna duly succeeded from ancient age. “Yi Peng” or full-moon day of second lunar month of Lanna villagers is corresponding to the full-moon day of 12th month of central region during the end of raining season and beginning of cold season when the climate is very nice and fair. One tradition of Lanna other than Loi Kra Thong on the river is to light up the lantern and float up in the sky based on their belief that to pay worship to Phra Ket Kaew Julamanee in the heaven or to relief one’ bad luck for more auspicious life."