How the date is fixed
Maha Shivaratri falls on the fourteenth day of the dark half of the lunar month Magha (Krishna Chaturdashi). The date is the day on which that tithi is running at the middle of the night (halfway from sunset to the next sunrise). In the North Indian (purnimanta) calendar the same fortnight is counted in Phalguna.
About
Maha Shivaratri falls on the fourteenth tithi of the dark half of Magha in amanta reckoning, which North India names Phalguna Krishna Chaturdashi; both point to the same night in February or March. Because it is a night vigil, the governing moment is nishitha, the middle of the night, and the day whose midnight holds Chaturdashi is chosen even if the tithi is absent at sunrise. A monthly Shivaratri is kept on every Krishna Chaturdashi; this one is the annual observance. The night is divided into four praharas with a round of worship in each.
How it is observed
A day-long fast, night vigil and abhisheka of the Shiva linga with water, milk and bilva leaves in each of the four praharas.