(Parshah Va’Yikra, being read today, discusses the sacrificial procedures in the Mishkan, and later the Temples. Below is a very good article on the purpose of the “korbanot” — the sacrificial offerings. Understanding their purpose helps us understand every aspect of Jewish observance.)
VaYikra – The Function of the Korbanos
by Eliezer Abramson 
The main topic of the book of Va’Yikra (Leviticus) is the korbanos [*] (sacrificial service). This is a topic that is generally poorly understood and one that is often surrounded by misconceptions. There are several reasons why misconceptions are so common in this area. Perhaps the most basic difficulty is that the Jewish people have not been able to perform the sacrificial service for close to two thousand years. As such, we have no real way of relating to what that service was actually like. This problem, which is a big enough problem in its own right, is exacerbated by another problem, which is all too common even in areas of Jewish life that are still part of daily practice. This is the tendency to interpret Jewish practices and concepts in non-Jewish terms. Living as we do, and in varying degrees have been since the destruction of the First Temple, in an environment dominated by non-Jewish cultures, it is difficult, even when aware of the problem, to avoid this tendency. And if it is difficult for us to avoid interpreting basic, commonplace Jewish concepts (such as prayer, spirituality, faith, or even the basic concept of religion) in purely Jewish terms, then it certainly is not surprising that we have difficulty with concepts that have not seen concrete expression for thousands of years. Often, even the very terminology is a problem, in that there are no English (more specifically, non-Hebrew) words that properly convey the intent of these concepts in Judaism.
Rabbi Samson Raphael Hirsch addresses this issue in connection to the korbanos early on in his commentary on Va’Yikra: 
“It is most regrettable that we have no word that really expresses the idea that lies in the word קרבן. The unfortunate use of the term “sacrifice” implies the idea of giving up something that is of value to oneself for the benefit of another, or of having to do without something of value, ideas which are not only entirely absent from the nature and idea of a קרבן but are diametrically opposed to it.
Also the underlying idea of “offering” makes it by no means an adequate expression for קרבן. The idea of an offering presupposes a wish, a desire, a requirement for what is brought, on the part of the one to whom it is brought, which is satisfied by the “offering.” One can not get away from the idea of a gift, a present.
But the idea of a קרבן is far away from all this. It is never used for a present or gift; it is used exclusively with reference to Man’s relation to God, and can only be understood from the meaning that lies in its root קרב [which] means ‘to approach,’ ‘to come near,’ and so to get into close relationship with somebody. …The object and purpose of הקרבה (making a קרבן; also the name of the step in the process of physically bringing the sacrifice near to the altar) [is] the attainment of a higher sphere of life. … The מקריב (the person making the קרבן) desires that something of himself should come into closer relationship to God, that it what קרבן is…. It is קרבת אלקים, nearness to God, which is striven for by a קרבן.”
The function of the korbanos, then, was to bring us closer to God. This itself may seems odd to many of us. The korbanos, after all, mainly involved the highly ritualized slaughter and cooking of animals. It was, if you will, a “holy barbecue”, the very phrasing of which expresses the incongruity that the korbanos present to the modern mind, for, while most of us enjoy barbecues, we tend not to associate them with holiness. This perceived incongruity really epitomizes the disconnect that we often have from a genuinely Jewish perspective. One of the most basic lessons of Judaism is that there is no fundamental divide between the physical and the spiritual. On the contrary, our task in this world is to sanctify every aspect of our “mundane”, material lives; to find holiness, closeness with God, in every thing we do, even the most ordinary.
In Judaism, ordinary activities like waking up in the morning and getting dressed, eating a meal or snack, and even going to the bathroom are transformed into religious activities, each with its own associated rituals and prayers. The Midrash  tells us that Hillel the Elder saw bathing as a form of Divine service. Maimonides  describes, at some length, how everything we do, including the acquisition of secular knowledge and the enjoyment of aesthetic pleasure (such as listening to music or taking a walk in the park), can and should be directed towards the goal of coming to know and love God.
While there are certainly many deep and profound lessons in the korbanos, a topic that is discussed at great length in many of the commentaries, I believe that it is this very point that may well be the most basic lesson that the korbanos are intended to teach us. As the Talmud  states, איזוהי פרשה קטנה שכל גופי תורה תלוין בה? בכל דרכיך דעהו – ‘What is a small verse upon which all the basics of Torah depend? ‘Know Him in all your ways’.  The Sages teach us that a true understanding of the entire Torah, i.e. of the purpose of our existence and of the creation of the universe, is based on the recognition that every aspect of human life can and should be used to bring us closer to God. The korbanos teach us that even the most mundane of activities – and there are few more superficially “unspiritual” places than a slaughterhouse – can be transformed into the highest form of Divine service. This apparently simple idea has the ability to entirely transform our lives, changing even the most “boring” and “ordinary” daily activities into the equivalent of the priestly service in the Holy Temple.
(see also my post http://rabbielimallon.wordpress.com/2011/03/06/3-6-11-why-vayikra/)
[*] pronounced “korbanot,” with the accent on the final syllable, in Sephardic and modern Hebrew
 commentary to 1:2
 Vayikra Rabba 34:3
 Shemoneh Perakim 5
 Brachos 63a
 Proverbs 3:6