When Yue was born she was born sick and her parents asked the moon spirit to help so the moon spirit put a part of itself in her. So when the moon spirit died she could put her part of the spirit back and join with the moon spirit.
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The avatar episode when Yue turns into the moon is in season 1, episode 20, called Siege of the North: Part 2
Depends. In "James Cameron's Avatar," the moon is called Pandora. The answer below applies to "The Last Airbender." Sokka's first love, Princess Yue of the Northern Water Tribe, became the moon. This was possible because as a baby she was stillborn, however her father placed her in the Moon Spirit pool and she came back to life. Therefore she had some of the moon's life in her and was able to save it when the Fire Nation killed the moon. The original moon's name was Twee.
New Moon was way better than Avatar.
The name of the moon is Yue (pronounced You-ae). You see, in the Northern Water Tribe, there was a princess called Yue. She became Sokka's first girlfriend. When she was born, she was very sick. So her father placed her in a sacred pool, where the moon and water spirits swam together as coy fish. The moon spirit gave her some of it's life, and it turned her hair white. When a cruel Fire Nation general killed the moon spirit coy fish, everything went out of balance - the moon went red, and everything was dark, and the water was out of sync. To restore balance, Yue decided to give her life to the moon spirit. She healed the coy fish, and as a result, she died afer having given it's life back to it. She became the moon, and as she did, her spirit kissed Sokka one last time. And that is how the moon spirit became known as Yue.
Pandora.
Pandora, in the movie Avatar, is basically a moon orbiting a fantasy planet, called Polyphemus. Pandora was speculated as being a moon of an actual planet, such as Jupiter or Neptune, but is, in reality, totally fictional.