Dissociation increases with dilution because each molecule requires certain amount of energy to break bonds. Consider HCl, it needs a certain amount of energy to dissociate into H+ and Cl-. We dissolved a certain amount of HCl in water, and HCl dissociates utilising the energy from water(water also dissociates into H+ and OH-). After some time only limited amount of water molecules will remain undissociated,and they will be unable to provide enough energy for dissociation. Once you add more water there will be more supply of energy to carry out dissociation. Thus degree of dissociation increases with dilution