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An endothermic reaction occurs when the energy used to break the bonds in the reactants is greater than the energy given out when bonds are formed in the products. This means that overall the reaction takes in energy, therefore there is a temperature decrease in the surroundings. Electrolysis is an example of an endothermic reaction but you can create one easily in the kitchen just by dissolving salt or sugar in water.
Exothermic and endothermic reactions both cause some type of energy level differences. In an exothermic reaction, energy is released in the form of heat. As chemical bonds are formed, energy is released. An example is water turning into ice. Chemical bonds form and release energy to create ice crystals. An endothermic reaction, however, is the opposite. Here, the energy is absorbed in the form of heat. When a chemical bond is broken, the energy used creates an endothermic reaction. Changing ice into water, then vapor, requires the chemical bonds to be broken.