Lennie waits by the water for George while drinking it, when he suddenly has an interesting vision.
Lennie then sees Aunt Clara, she gets into his head and starts speaking in Lennies own voice telling him everything he has done to George, not listening to him and causing him nothing but trouble.
After the mess with Aunt Clara his second vision appeared, a gigantic rabbit stood over him. The rabbit tells Lennie that George will beat him and abandoned him.
George starts telling Lennie about the story of their farm, he describes the rabbits and tells Lennie how no one will ever be mean to him again, then BOOM. George shot him.
Just to give a bit of recap, George thought of Lennie as a burden at some point. From getting them kicked out of their job, holding them back, and killing several animals maybe you can get an idea of why George did what he did.
Then George finally appears.. He acts normally and goes on like nothing. And as usual Lennie makes his offer to go away but George tells him to stay which gives Lennie some comfort, But George knew what he needed to do.