Dissociation
Imagine the mind has many layers of awareness. In clear consciousness we are aware of our surroundings and our inner thoughts usually at all levels. The sensation of hunger at one level is accompanied by fantasies of food and plans of how to get that food at other levels. At other levels of the mind memories of past meals and events might be triggered too. Somehow the thoughts, memories and sensations on all these levels are integrated.
In dissociation disorders we might imagine that somehow the layers are not being integrated properly, so that there are discrepancies or dissociations between the thought activity at different levels. Some people speak of a 'splitting of the stream of consciousness'.

Braindevelopment
Dissociation in a neurological sense is: a neuro-psychological change of function which disturbes and maintains the separation of normal mutual dependent neuro-psychological processes.
A Dissociative Identity Disorder develops in the early years of childhood. Because the brains of babies and toddlers are still not fully grown and developed, serious traumas can have a devastating effect on the development of the brains of those children.

Brains develop in a 'user dependent' way of growth, functioning and organizing according to experiences. With appropriate stimili like love, attention and care from parents, the brains form connections (synapses) which are necessary for good functioning.
These reactions of little children to traumatic experiences have a normal and biological basis. First they are overwhelmed by fear (hyperarousal), attended by an increased heartbeat, muscle tension and an inclination of 'flight or fight'.
Further they 'freeze' and withdraw into the self (dissociation), attended by a low heartbeat and sharpening of the perception senses. In a matter of speaking they keep themselves 'dead', as can also seen in animals who are attacked. It is a survival strategy for mammals, so also for human beings.

Severe stress and anxiety
Mature children who are exposed to traumatic stress several times develop a neural system to cope and adapt to those traumatic experiences. From an evolutionary point of view this makes sense. "While those areas in the brain which deal with emotional regulation are underdeveloped by a neglected child, those areas which cope with stress are often overdeveloped by such children."(Teicher; Perry; (2002).

"A part in the brain which is primairly affected by stress and anxiety is the amygdala, which is involved in the perception and response to fear-evoking stimuli. To carry out its role in sensing threat, the amygdala receives input from neurons in the outermost layer of the brain, the cortex, where much high-level; processing takes place. Some of this input comes from parts of the cortex that processes sensory information f.i. recognizing faces, as well as from the fromntal cortex, which is involved in abstract associations. The amygdala also takes in sensory information that bypasses the cortex. As a result, a subliminal preconscious emnace can activate tha amygdala, even before there is conscious awareness of the trigger. Imagine a victim of traumatic experience who, in a crowd, suddenly finds herself anxious, her heart racing. It takes her moments to realize that a man conversing behind her has a voice similar to that of a man who once assaulted her. The amygdala, in turn, contacts an array of brain regions"(Sapolsky; (2003)

There are two general forms of memory. The explicit memory governs the recollection of facts, events or associations. Explicit memory is not well developed in children, raising the possibility that more memories become implicit at this age. Implicit memory is about recalling how to ride a bike, or play a passage on the piano. And also the example of the woman in the crowd who heard the voice is implicit memory. "Researchers have begun to understand how these fearfull memories are formed and how they can be overgeneralized after repeated stress. Recent research indicates that tha amygdalic neurons of rats in stressfull situations sprout new branches, allowing them to make more connections with other neurons. For instance, a victim, if he had been robbed several times at night, might experience anxiety and phobia just by stepping outside his home, even under a blazing sun."(Sapolsky; (2003)