Hi Kyla,
The northern lights occur when charged particles follow coming from
space follow the magnetic field lines at the poles of the Earth down to
the atmosphere. The particles interact with the Earth's
atmosphere and cause the colors you see (sort of like how Sodium vapor
lights work). The different colors result from collisions with
different atoms and molecules (like oxygen and nitrogen) in the
atmosphere.
Typically auroras (also know as the northern lights and the southern
lights) happen near the poles of the Earth and so people in Alaska and
parts of Canada see them often. But, the region where particles
can reach the atmosphere can move southward depending on changes in the
Earth's magnetic field. Under special conditions people as far
south as California and Texas can see aurora too.
There is some evidence that aurora were seen very, very long ago
(possibly in cavemen paintings and ancient Chinese
civilizations). Here's a link about some of the old possible
sightings:
http://virtual.finland.fi/netcomm/news/showarticle.asp?intNWSAID=25576
Best,
Christina