The Dragon Boat Festival, celebrated on the fifth day of Lunar May, is another significant festival in the Chinese traditional celebration.
might be better expressed: "significant traditional Chinese festival"
This holiday commemorates the death of Chyu Yuan, a well-loved poet of the forth century B.C., who drowned himself to protest his king’s despotic rule.
? protest against protest about
The villagers respected him so much that they rowed their boats down to the river and dropped chung-tze, rice dumplings, into the river to feed the fishes, so they will not eat Chyu Yuan’s body.
Did they row them across land? Look again!
"so that they"
To celebrate the Dragon Boat festival, families do several things such as make the chung-tze, hang the moxa herb, and watch the Dragon Boat race. Before the Dragon Boat festival, every family prepares chung-tze. This is a kind of rice dumpling filled with various things, such as bean curd, meat, mushroom, and shrimp, then wrapped in bamboo leaves and steamed. The mother and the children work together to prepare the chung-tze.
(remove unnecessary comma)
Then, each family also has to buy moxa herb and hang it in a special location. Some people even use these herbs to wash sick babies. Since they believe that this special festival can bring some “transformation” in people lives, usually, the father and the boys find a location to hang the moxa herb.
"bring about some...." people's
I think you need to state that moxa is believed to bring good luck.
Also it is the herb that transforms, not the festival.
The sentence about the fathers and sons needs to be separated from the previous statement (unless of course there is a link).
After preparing the chung-tze, each family goes to the river to watch the Dragon Boat races that take place on the festival day. The Dragon Boat race, that symbolizes the story of Chyu-Yuan, is a rowing boat team competition with about thirty people in each team. During the race, all the spectators cheer and shout enthusiastically. After the exiting [spelling] race, usually both the competitors and the spectators eat many chung-tze. The Dragon Boat festival symbolizes the unique meanings of Chinese history. Furthermore, the process of making the rice dumpling, hanging the moxa herb, and the boat races are good ways of drawing all members of the family together. Perhaps, one day we will have a different celebration, but so far, I still like this holiday to be celebrated in a traditional way.
Try to split the text into paragraphs. Good otherwise, and very interesting