"This period's starting point is uncertain; it may have begun in Spain in the spring of 1901, or in Paris in the second half of the year. In choosing austere color and sometimes doleful subject matter—prostitutes, beggars and drunks are frequent subjects—Picasso was influenced by a journey through Spain and by the suicide of his friend Carlos Casagemas, who took his life at the L’Hippodrome Café in Paris, France by shooting himself in the right temple on February 18, 1901. This happened at a time when Picasso had begun achieving some success; according to art historian Hélène Seckel, "it is difficult to say why the twenty-year-old Picasso abandoned the dazzling palette and exuberant subject matter that had already come to characterize his work. According to the artist, the suicide[...]marked the sudden onset of the blue period: 'I started painting in blue when I learned of Casagemas's death.'"

Sources and more information:
http://www.artchive.com/artchive/P/picasso_blue.html
http://en.wikipedia.org/wiki/Picasso&

Do I win prizes for answering these or what?