After gaining an insight into World War-I from centenary exhibition, held by Imperial war Museum, I feel qualified to answer this question. So here are my 2 cents :P

Triple Military allianceSo I'll start with explaining Political situation of the region before war.

There existed a triple Military alliance between Germany, Italy and Austro-Hungary (marked in red) from 1882 on-wards.Each member promised mutual support in the event of an attack by any other power.

Italy's Stand :

Because Germany and Austria–Hungary had taken the offensive while the Triple Alliance was supposed to have been a defensive alliance, Italy did not enter into the war. Later on, Italy entered the conflict on the side of the Entente, declaring war against Austria–Hungary in May 1915 and Germany in August 1916.

Triple EntenteIt was the alliance linking France, Russian empire and finally Great Britain joining in 1907. All three of the Triple Entente entered it as Allies against the Central Powers Germany and Austria-Hungary.

It shows the web of alliance at that time, which is credited to be biggest cause of WWI. Germany's General envied British Naval fleet and its global dominance in trade. And due to tensions in Balkan region, it was already against Russia.

The period before 1914 was Peaceful but Politically very tensed and volatile.It all started with rather a Isolated event: On 27th June, 1994 a Serbian backed terrorist murdered the heir to Austro-Hungarian throne. A month later Austria-Hungry with encouragement from Germany declared war on Serbia. So other powers intervene, Russia decides to stand up for Serbia and Germany takes side with only reliable ally Austro-Hungary. These powers were ready to risk war to extend their national interests. Germany strikes first declaring war on Russia in east and France in the west.Germany Invaded Belgium to get to France.

Why Britain Joined in ?

Britain had no obligation to fight but they feared a victorious and hostile Germany which would then emerge as world power and threaten Britain's security and trade dominance. So for them World power was at stake. Also Britain had long promised to protect Belgium's neutrality.

So British Prime Minister Herbert Asquith gave an ultimatum to Germany to withdraw its troops from Belgium. Alas, there was no reply.

So on 4th August 1914, with its vast global empire, Britain declared war on Germany.

How did USA get in ?

The U.S. was an independent power and did not officially join the Allies. It closely cooperated with them militarily but acted alone in diplomacy.

However, When a German U-boat sank the British liner Lusitania in 1915, with 128 Americans aboard, Wilson said, "America is too proud to fight," and demanded an end to attacks on passenger ships. Wilson repeatedly warned the U.S. would not tolerate unrestricted submarine warfare, in violation of international law and of human rights. Wilson was under pressure from war hawks led by former president Theodore Roosevelt, who denounced German acts as "piracy".Wilson realized he needed to enter the war in order to shape the peace. Finally, United States entered the war in 1917 against German forces. Before entering the war, the US had remained neutral, though it had been an important supplier to Britain and other Allied powers. During the war, the US mobilized over 4,000,000 military personnel and suffered 110,000 deaths.