What is the true purpose of life? Why are we here on earth?
Allah said: (Quran 51:56) I have not created jinn nor men except to worship Me.
We are here to worship Allah, that's why He created us, He does not need us to worship Him (He is free from all needs), but He wants us to and that satisfies Him. The angels worship Allah days and nights, but they don't have any choice like us, they don't eat, drink or have any other enjoyment as we have. The only thing that they enjoy is worshipping Allah. Their worship to Allah is an act similar to our breath. It comes naturally without any effort but our worship to Allah is by choice. We choose to worship Him and we make efforts for that and that's what satisfies Allah more than the angels or any other creatures worship.
We worship Allah for couple of reasons:
Firstly, because we love Him. He gave us all the bounties that we have our sight, hearing, feeling, thinking, provisions, etc. So the least we could do to thank Him is to worship Him. As Allah said: (Quran 3:31) Say (O Muhammad): "If you love Allah, follow me: Allah will love you and forgive your sins, for Allah is Oft-forgiving, Most Merciful"
Secondly, we hope to gain Allah's Mercy and enter Paradise by our worship we seek His Mercy.
Thirdly, we fear His severe punishment (Hell). As Allah said: (Quran 17:57) " ... they hope for His Mercy and fear His Torment. Verily, the Torment of your Lord is something to be afraid of."
Fourthly, we obey His order to worship Him alone. As Allah said: (Quran 2:21) "O mankind! Worship your Lord (Allah), Who created you and those who were before you so that you may become pious. Who has made the earth resting place for you, and the sky as a canopy and sent down rain from the sky and brought forth therewith fruits as a provision for you. Then do not set up rivals unto Allah (in worship) while you know (that He Alone has the right to be worshiped)