The islands were first discovered by Chinese fishermen in the 16th century and taken over by Japan in 1879. They are valuable now because of the 380 kilometer EEZ (exclusive economic zone) international law allows nations to claim in their coastal waters. This includes fishing and possible underwater oil and gas fields.
A conservative Japanese political group built a lighthouse there in 1986, to further claims of Japanese ownership. Currently, the Japanese have the most powerful naval forces in the region and are backed up by a mutual defense treaty with the United States. China was long dissuaded by that but no more. China is no longer backing off on its claims, and neither is Japan. So these confrontations are becoming more serious.
The new Chinese tactic of sending more and more boats and aircraft takes advantage of the fact that, while Japan has better ships and crews, China has more patrol boats and men. In combat Japan would have an edge, but in this endurance contest the advantage shifts to China. In response Japan is building more patrol boats, bringing retired ships back into service, and devising new tactics of its own that rely on technological advantages.