On board were astronaut Virgil I. "Gus" Grissom, (the second American astronaut to fly into space) astronaut Edward H. White II, (the first American astronaut to "walk" in space) and astronaut Roger B. Chaffee, (a "rookie" astronaut on his first space mission).
At 1:00 PM the crew entered the capsule, located on Pad 34 to start the test. From the beginning, there were problems. Several minor problems appeared, delaying the process quite a bit. Finally, a communications failure caused a hold to be placed on the count at 5:40 PM.
At 6:31 PM, a voice (later believed to be Roger Chaffee) exclaimed, "Fire, I smell fire." Two seconds later, Ed White's voice came over the circuit, "Fire in the cockpit." The final voice transmission from the crew was very garbled. "They’re fighting a bad fire—let’s get out. Open ‘er up" or, "We’ve got a bad fire—let’s get out. We’re burning up" or, "I’m reporting a bad fire. I’m getting out." The transmission ended with cry of pain, perhaps from the pilot.
The fire spread quickly through the cabin. That last transmission ended within 17 seconds after the start of the fire. All telemetry information was lost shortly after that. Although personnel were dispatched quickly to help, many things conspired to slow the rescue effort.
The hatch was held closed by several clamps which required extensive ratcheting to release. Under the best of circumstances, it could take at least 90 seconds to open. Since it opened inward, pressure had to be vented before the hatch could be forced open. It was nearly 5 minutes after the start of the fire before rescuers could get into the cabin. By this time, the oxygen rich atmosphere which had seeped into the materials of the cabin had caused the fire to spread rapidly.
The crew most likely perished within the first 30 seconds from smoke inhalation or burns. Resuscitation efforts were futile.
A hold was placed on the entire Apollo program while an exhaustive investigation was made of the accident. Although a specific initiator could not be determined, the final report of the investigation board blamed the fire on arcing. It was further exacerbated by the large quantity of flammable materials in the cabin and the oxygen enriched atmosphere.
For future missions, most flammable materials were replaced with self-extinguishing materials. Pure oxygen was replaced by a nitrogen-oxygen mixture at launch. Finally, the hatch was redesigned to open outward and to be able to be removed quickly.
The Apollo/Saturn 204 mission was officially assigned the name "Apollo 1" in honor of Grissom, White, and Chaffee. The first Saturn V launch (uncrewed) in November 1967 was designated Apollo 4 (no missions were ever designated Apollo 2 or 3).