When you dilute something, you make it thinner, weaker, or more watered down. If you put lots of ice cubes in your soda, the ice will melt and dilute the drink.
Think about diluting as lessening the quality but increasing the quantity. Unless you're diluting a really strong drink to make it taste better or diluting heavy paint to get a lighter shade — then the quality actually improves. Quipped President John F. Kennedy, “Public speaking is the art of diluting a two-minute idea with a two-hour vocabulary.”