As recording process in holography is based on the principle of interference. For recording and for sustained interference, the path difference between various interfering light waves should always be less than longitudinal coherence length. For ordinary light source like mercury the coherence length is very small (≈3cm). The path difference introduced between light waves reflected from different points of object can be much more than this value. Thus interference pattern cannot be recorded. While coherence length for laser source can be as high as 600 km. As a result, sustained interference pattern will be recorded on hologram. Thus hologram cannot be made without laser source.
Further if a hologram is reconstructed using ordinary light, then the reference beam, converging rays (forming real image) and diverging rays (forming virtual image), all will be in same direction. This creates a problem in observing three dimensional image, as we have to see through other two beams. Holography using ordinary light is called ‘Inline Holography’. If Laser source is used instead, then the three emerging beams will be in different directions. This is called ‘Off Line Holography’. It allows us to observe one kind of beam at a time.
This is the reason that laser is needed in holography.