You drop a ball from a height of 1.8 m, and it bounces back to a height of 1.2 m where did the energy go?

If you are comparing it to a real life situation, then there will be a loss of energy. The reason why is because when the ball is starting from initial height, as you drop it, the ball gains a downwards velocity due to gravity. However, gravity is not the only force in play. In real life application, air resistance is present, which decreases the ball's acceleration. Thus, causing the ball to lose energy and finally stop on the surface.