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The maid of honor is considered a position of honor; pardon the pun, in your wedding party. A bride will typically ask a close female friend or relative to fulfill this position. In some cases, the mother or daughter of the bride will be asked to serve as maid of honor. (It's worth noting, however, that if the woman you ask to fulfill this position is married, she should be called your Matron of Honor).
The Maid of Honor has a variety of typical responsibilities. Her primary part is to be the leader of the support for the bride. She will coordinate the bridesmaids to make sure they make it to their fittings, pick up their dresses on time as well as arranging for any pre-wedding grooming preparations like hair, make-up and nails. The Maid of Honor will also be responsible for making the arrangements for the bachelorette party.
During the wedding, the maid of honor will help the bride with pretty much everything. She will adjust her train, hold the groom's rings, hold the bride's flowers during the ceremony and sign the marriage certificate as an official witness of the wedding. A word to the wise, don't let the maid of honor schedule any kind of night before the wedding party – the best thing for the prospective bride (and groom for that matter) is a good night's sleep.