Mahabali was Prahlada's grandson.
He came to power by defeating the gods (Devas), and taking over the three worlds.
Bali, an Asura king was well known for his bravery, uprightness and dedication to god Vishnu.
Bali had amassed vast territories and was invincible.
He was benevolent and popular, but his close associates weren't like him.
They were constantly attacking the suras (Devas) and plundering the gods who stood for righteousness and justice.

According to Vaishnavism mythology, Indra and the defeated suras approached Vishnu for help in their battle with Mahabali.
Vishnu refused to join the gods in violence against Mahabali, because Mahabali was a good ruler and his own devotee.
But, instead of promising to kill Bali, Vishnu promised to use a tactical means to help the suras.

Mahabali announced that he will perform Yajna (homa sacrifices) and grant anyone any gift they want during the Yajna.
Vishnu took the avatar of a dwarf Brahmin called Vamana and approached Mahabali.
The king offered anything to the boy – gold, cows, elephants, villages, food, whatever he wished.
The boy said that one must not seek more than one needs, and all he needs is the property right over a piece of land that measures "three paces".
Mahabali agreed.
The Vamana grew to enormous proportions, metamorphosing into the Trivikrama form, and covered everything Mahabali ruled over in just two paces.
For the third pace, Mahabali offered his own head to Vishnu who pushed him as the king of patala (nether world).

Pleased with the dedication and integrity of Bali, Vishnu granted him a boon that he could return to earth for one day in a year to be with his people, be worshipped and be a future Indra.
It is this day that is celebrated as the Bali Padyami, the annual return of Bali from the netherworld to earth.

Another version of the legend states that after Vamana pushed Bali below ground (patalaloka), at the request of Prahlada (described as a great devotee of Vishnu), the grandfather of Bali, Vishnu pardoned Bali and made him the king of the netherworld.
Vishnu also granted the wish of Bali to return to earth for one day marked by festivities and his worship.
Mahabali was Prahlada's grandson. He came to power by defeating the gods (Devas), and taking over the three worlds. Bali, an Asura king was well known for his bravery, uprightness and dedication to god Vishnu. Bali had amassed vast territories and was invincible. He was benevolent and popular, but his close associates weren't like him. They were constantly attacking the suras (Devas) and plundering the gods who stood for righteousness and justice.
According to Vaishnavism mythology, Indra and the defeated suras approached Vishnu for help in their battle with Mahabali. Vishnu refused to join the gods in violence against Mahabali, because Mahabali was a good ruler and his own devotee. But, instead of promising to kill Bali, Vishnu promised to use a tactical means to help the suras.
Mahabali announced that he will perform Yajna (homa sacrifices) and grant anyone any gift they want during the Yajna. Vishnu took the avatar of a dwarf Brahmin called Vamana and approached Mahabali. The king offered anything to the boy – gold, cows, elephants, villages, food, whatever he wished. The boy said that one must not seek more than one needs, and all he needs is the property right over a piece of land that measures "three paces". Mahabali agreed. The Vamana grew to enormous proportions, metamorphosing into the Trivikrama form, and covered everything Mahabali ruled over in just two paces. For the third pace, Mahabali offered his own head to Vishnu who pushed him as the king of patala (nether world).
Pleased with the dedication and integrity of Bali, Vishnu granted him a boon that he could return to earth for one day in a year to be with his people, be worshipped and be a future Indra. It is this day that is celebrated as the Bali Padyami, the annual return of Bali from the netherworld to earth. 
Another version of the legend states that after Vamana pushed Bali below ground (patalaloka), at the request of Prahlada (described as a great devotee of Vishnu), the grandfather of Bali, Vishnu pardoned Bali and made him the king of the netherworld. Vishnu also granted the wish of Bali to return to earth for one day marked by festivities and his worship.
Balipratipada