How does Bottom become an ass? What is the reason for this strange event?

In act III, scene 1, Nick Bottom is turned (partly) from a man into an ass when Puck puts a spell on him. It is only his head, not his whole body, that is transformed. Puck was making mischief, which his trickster personality always has him doing, but the result is that Titania, Queen of the Fairies, falls in love with Bottom. She and her husband, Oberon, are in the midst of serious disagreements. While she was asleep, Oberon put a spell on her to make her fall in love with the first being she saw upon awakening.
Bottom, Quince, and their friends have found a handy spot in the forest to rehearse their play, Pyramus and Thisbe. Unnoticed by them, Titania is sleeping nearby. When Puck comes upon them, he decides to eavesdrop on them. Bottom exits, according to his part in the play, and Puck follows him.
When Bottom returns, unbeknownst to him, he has the head of ass. Frightened, his friends run off, and Bottom cannot figure out why. When they tell him he is “translated,” he thinks they are teasing, so he resolves to stay there and show them he is not afraid. Titania, awakening, falls in love with Bottom. Many further plot complications ensue until Oberon lifts the spell (act IV, scene 1).
http://www.shakespeare-online.com/plays/mids_3_1.html