The Games were marred by what has come to be known as the Munich massacre. On September 5 a group of eight Palestinian terrorists belonging to the Black September organization broke into the Olympic Village and took eleven Israeli athletes hostage in their apartment, killing two of the hostages in the apartment after fighting back; the subsequent standoff in the Olympic Village lasted for almost 18 hours.

During a botched German rescue attempt at the military airport of Fürstenfeldbruck, where the captors with their hostages had been transferred by helicopter, ostensibly to board a plane bound for an undetermined Arab country, all the surviving Israeli hostages were killed by a Palestinian who threw a grenade into the helicopter carrying the hostages in one helicopter and another Palestinian who sprayed the second helicopter with machine gun fire.
All but three of the Palestinians were killed as well. Two of those three were supposedly killed later by the Mossad. Jamal Al-Gashey is believed to be the sole survivor, and is still living today in hiding in an unspecified Arab country. The Olympic events were briefly suspended but Avery Brundage, the International Olympic Committee president, decided that "the Games must go on." Competition resumed a day later.