As it collapses, the temperature in the core begins to rise and heat the surrounding hydrogen layers. When the temperatures in these surrounding layers are high enough, the hydrogen ignites and becomes a hydrogen fusion shell. The energy created by the hydrogen shell pushes the outermost layers of the star (the stellar envelope) outward, causing them to expand and cool. Cooler stars appear redder. In addition, the luminosity - radius - temperature relation tells us that, even though the temperature of the star is lower in this phase than in the MS phase, because its radius is so much greater, its luminosity is also higher. The combination of cooler temperature and larger luminosity is what causes the star to appear as a red giant.
During this expansion, the core has still been contracting and the core temperature rising. When the temperature gets high enough (about 100 million degrees Kelvin), the helium core ignites and starts fusing helium into carbon and oxygen. For stars less than about 2 solar masses, this burning begins explosively, causing what is known as the helium flash.