At least six countries are now staking claim to various island-reef extensions that were once primarily fishing areas, or a place for shipwrecked sailors and pirates to hang out.
The story is a rather simple one. It's about resources and projecting national power in the region.
However, simply claiming a set of islands in international water and then building on them is not sufficient for making claims, as the Chinese have learned over the past two decades. This is especially the case with the Spratly Islands, which are just south of the South China Sea.
Still, the Chinese began claiming the areas surrounding makeshift fishing villages in the region, many of which were little more than overgrown piers built on submerged rock formations (Chinese fishermen were actively encouraged into the region).
But claiming and building artificial structures in the ocean doesn't grant you Law of the Sea protections, let alone legal permission to declare huge swaths of the ocean as your territory. So China began building islands on and around reef formations with dredged sand, and are effectively daring others to kick them off.
To build their islands they suck millions of tons of sand off the ocean floor and pile it in one area. The site below is being built on Mabini Reef, and was pictured Feb. 2014.
Reclaimed land from the sea is piled up and then used to build facilities, which include military bases.
Below we have the story of the Fiery Cross reef, which is claimed by Vietnam but occupied by China. What started out as a reef is now an island airstrip, with a harbor and building facilities.
To build the island suction dredgers (with the long snaking hoses below), cargo vessels, and even fishing boats (smaller ships) were necessary.
As the "island" began to take shape it was easy to see that it would be used as an air base and port facility.
And since you have to build, you should make sure you have a military presence to help insure that everyone knows you're serious, right?
Check out what happened to the Mabini Reef in the span of two years.
As you can see in the top left corner of this picture, in March of 2012, you have a reef with a few protruding rock structures. One of the rocks becomes the anchor point for a building structure (top right corner) that will slowly be surrounded by dredged and reclaimed sand. Within two years we have an island structure, which China can now claim as part of its national territory - along with the 12 miles of surrounding ocean to boot.
Some interesting links ...
What Vietnam claims in the Truong Sa (Spratly) Islands has been claimed by China on Mischief Reef http://www.thanhniennews.com/world/china-building-possible-airfield-in-south-china-sea-us-34338.html
Artificial structures or reclaimed land from the sea? Which does the U,S. support, and why are the Chinese so mad? http://www.chinausfocus.com/foreign-policy/washington-needlessly-escalates-south-china-sea-crisis/
UPDATE (2-10-16): China installs two launch batteries for surface-to-air missiles in the Paracel Islands ... http://www.economist.com/news/leaders/21693207-chinas-bullying-south-china-sea-must-not-be-allowed-pay-sunnylands-and-cloudy?spc=scode&spv=xm&ah=9d7f7ab945510a56fa6d37c30b6f1709
UPDATE (2-19-17): John Oliver did a segment on China building islands (like never before), which you can access by clicking here.