The Earth's magnetic dynamo is generated by a current in the interior of the planet that is a result of the eddies that form thanks to the outer core being molten.
Since Mars is a smaller planet and is located twice as far from the Sun as Earth, it cooled faster and likely no longer has a molten or semi-molten interior. The cooling of the interior of the planet would have shut off the magnetic process and could explain why the modern Martian atmosphere is so tenuous.
