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Malting is a process used on various cereal grains, germinating them by soaking them in water, then heating them to retard the germinating process. It's commonly done to barley, for a wide range of purposes, most notably the brewing of beer. The process is ancient, with its roots hidden in the mist of time, but it was definitely in use by the time of the Ancient Egyptians, thousands of years ago.
Early malting likely took place in a very simple way. It appears that the Egyptians would fill a basket with grain, and lower it into a well until submerged in water. Then they would raise it slightly out of the water to let it begin to germinate. By changing the height of where the malt basket was held, they could change the speed at which the process occurred. Once it had germinated enough, they would take it out and spread it on the ground in the sun, letting the sunlight dry the grain.
Eventually, this process became too limited to meet the demand for malt to produce beer in central Europe many centuries later. Special buildings were created for this process, known as malthouses. Early malthouses were found on a hill near a stream, and barley or some other grain would be shoveled in to the top of the building and left to steep in the water. Then it would be left on the floor to germinate, and as heat was generated it would be shifted further along, eventually coming to the end of the room. From there it would be moved into wheelbarrows and brought to a kiln, where it would be dried out, being moved around occasionally to make sure gasses didn’t build up.
It wasn’t until powerful energy sources appeared, in the form of steam and later electricity, that the process of malting shifted again. While it once could only be done during colder months, with power sources it became possible to artificially cool the malthouses to keep them the ideal temperature year round. Later, new technologies like conveyer belts, perforated floors, and turning machines were added, to make the process even easier, enabling the mass production necessary for modern uses.
The point of malting a grain like barley is to change the structure of the cereal to better fit a certain purpose. One thing that happens when grains malt is that they create large amounts of sugar, mostly maltose, in their bodies. This sugar is used, for example, during the beer making process as the main agent driving fermentation. Without germinating, the energy stored in the seed of the grain is too tightly held to be of much use to a brewer or a cook, so this process forces a partial germination to release all of this energy.
On a deeper level, as a grain begins to germinate it releases an assortment of enzymes, and creates new enzymes, which break down and change the endosperm of the grain. This endosperm is a starch matrix, consisting of protein and carbohydrates, and as the enzymes break it down they release starch granules, pentosans, and beta-glucans. Depending on how much is desired, the malting process may be allowed to go on for some time, or it may be stopped rather quickly.