Today's Image of Mars is of gullies on the wall of Dao Vallis, just upstream of its merge with Niger Vallis. The gullies that flow into Dao Vallis begin just below the top of the valley and erode through the upper rock layers. The material that once filled the valley was likely ice rich and melted through the upper layers of rock, much like slow moving glacial material on Earth.
Dao Vallis is an outflow channel that was most likely created by massive flooding caused by the catastrophic release of ground water. This likely occurred because of a rupture in an underground source of water, either from tectonic shifts in Mars' ancient past, or meteorite impacts.
Clicking on this image will take you to the captioned image by HiRISE.