From the Memorial Day History website:
Memorial Day, originally called Decoration Day, is a day of rememberance for those who have died in our nations’s service. Memorial Day was officially proclaimed on 5 May 1868 by General John Logan, national commander of the Grand Army of the Republic, in his General Order No. 11, and was first observed on 30 May 1868, when flowers were placed on the graves of Union and Confederate soldiers at Arlington Cemetery. The first state to officially recognize the holiday was New York in 1873.
Memorial Day is currently celebrated on the 4th Monday in May (May 25th for 2009).
