In the past, Mars was much different than it is today. Liquid water used to flow on the surface, as shown in this picture. Both the Earth and Mars should have been frozen in their early history because the sun was weak at first, but both planets show that water was flowing, which suggests that they both must have had thick atmospheres in place to keep the surface warm. In this environment life may have once thrived.
The atmospheres on both planets came out of volcanoes. There were not many volcanoes on Mars, and those volcanoes were never very active. (Compare this to the Earth where volcanism continues today). Today, unlike the Earth where the surface plates still move around and create earthquakes, Mars' surface is fixed. This means no new releases of gas. It also means that carbon dioxide, which is absorbed into the ground and ocean on Earth, is absorbed into the ground of Mars and is never released.
The volcanic eruptions produce a lot of water. The water eventually falls to the ground or into the oceans. Mars is small, and so cooled off very rapidly. Mars was sufficiently cold for water to be absorbed into the ground and freeze like tundra in the Canadian northwest. Today scientists estimate that a large amount of water is frozen into the surface of Mars. They estimate this happened by 2.8 billion years ago. By comparison, check the geologic record for where the Earth was at that time. Or read about NASA's attempts to understand the environment of Mars by leaving this tour and linking to the Exporatour: NASA's Exploration for Life at the bottom of this page.
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