The fire started at about 9 p.m. on Sunday, October 8, in or around a small shed that bordered the alley behind 137 DeKoven Street. The traditional account of the origin of the fire is that it was started by a cow kicking over a lantern in the barn owned by Patrick and Catherine O'Leary. Michael Ahern, the Chicago Republican reporter who created the cow story, admitted in 1893 that he had made it up because he thought it would make colorful

The fire's spread was aided by the city's overuse of wood for building, the strong northwesterly winds, and a drought before the fire. The city also made fatal errors by not reacting soon enough and citizens by not caring about the fire when it began. The firefighters were also exhausted from fighting a fire that happened the day before.

The city's fire department did not receive the first alarm until 9:40 p.m., when a fire alarm was pulled at a pharmacy. The fire department was alerted when the fire was still small, but the guard on duty did not respond as he thought that the glow in the sky was from the smoldering flames of a fire the day before. When the blaze got bigger, the guard realized that there actually was a new fire and sent firefighters, but in the wrong direction.

Soon the fire had spread to neighboring frame houses and sheds. Superheated winds drove flaming brands northeastward.

When the fire engulfed a tall church west of the Chicago River, the flames crossed the south branch of the river. Helping the fire spread were firewood in the closely packed wooden buildings, ships lining the river, the city's elevated wood-plank sidewalks and roads, and the commercial lumber and coal yards along the river. The size of the blaze generated extremely strong winds and heat, which ignited rooftops far ahead of the actual flames.

The attempts to stop the fire were unsuccessful. The mayor had even called surrounding cities for help, but by that point the fire was simply too large to contain. When the fire destroyed the waterworks, just north of the Chicago River, the city's water supply was cut off, and the firefighters were forced to give up.

As the fire raged through the central business district, it destroyed hotels, department stores, Chicago's City Hall, the opera house and theaters, churches and printing plants. The fire continued spreading northward, driving fleeing residents across bridges on the Chicago River. There was mass panic as the blaze jumped the river's north branch and continued burning through homes and mansions on the city's north side. Residents fled into Lincoln Park and to the shores of Lake Michigan, where thousands sought refuge from the flames.

Philip Sheridan, a noted Union general in the American Civil War, was present during the fire and coordinated military relief efforts. The mayor, to calm the panic, placed the city under martial law, and issued a proclamation placing Sheridan in charge. As there were no widespread disturbances, martial law was lifted within a few days. Although Sheridan's personal residence was spared, all of his professional and personal papers were destroyed.

The fire finally burned itself out, aided by diminishing winds and a light drizzle that began falling late on Monday night. From its origin at the O'Leary property, it had burned a path of nearly complete destruction of some 34 blocks to Fullerton Avenue on the north side.

Once the fire had ended, the smoldering remains were still too hot for a survey of the damage to be completed for days. Eventually it was determined that the fire destroyed an area about four miles (6 km) long and averaging 3/4 mile (1 km) wide, encompassing more than 2,000 acres (8 km²). Destroyed were more than 73 miles (120 km) of roads, 120 miles (190 km) of sidewalk, 2,000 lampposts, 17,500 buildings, and $222 million in property - about a third of the city's valuation. Of the 300,000 inhabitants, 90,000 were left homeless. The fire was said by The Chicago Daily Tribune to have been so fierce that it surpassed the damage done by Napoleon's siege of Moscow in 1812. Remarkably, some buildings did survive the fire, such as the then-new Chicago Water Tower, which remains today as an unofficial memorial to the fire's destructive power. It was one of just five public buildings and one ordinary bungalow spared by the flames within the disaster zone. The O'Leary home and Holy Family Church, the Roman Catholic congregation of the O'Leary family, were both saved by shifts in the wind direction that kept them outside the burnt district.

After the fire, 125 bodies were recovered. Final estimates of the fatalities ranged from 200-300, considered a small number for such a large fire. In later years, other disasters in the city would claim more lives: at least 600 died in the Iroquois Theater fire in 1903; and, in 1915, 835 died in the sinking of the Eastland excursion boat in the Chicago River. Yet the Great Chicago Fire remains Chicago's most well-known disaster, for the magnitude of the destruction and the city's subsequent recovery and growth.

Land speculators, such as Gurdon Saltonstall Hubbard, and business owners quickly set about rebuilding the city. Donations of money, food, clothing and furnishings arrived quickly from across the nation. The first load of lumber for rebuilding was delivered the day the last burning building was extinguished. Only 22 years later, Chicago hosted more than 21 million visitors during the World's Columbian Exposition. Another example of Chicago's rebirth from the Great Fire ashes is the now famed Palmer House hotel. The original building burned to the ground in the fire just 13 days after its grand opening. Without hesitating, Potter Palmer secured a loan and rebuilt the hotel in a lot across the street from the original, proclaiming it to be "The World's First Fireproof Building".

In 1956, the remaining structures on the original O'Leary property were torn down for construction of the Chicago Fire Academy, a training facility for Chicago firefighters located at 558 W. DeKoven Street. A bronze sculpture of stylized flames entitled Pillar of Fire by sculptor Egon Weiner was erected on the point of origin in 1961.

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