Rock Springs sat atop rich coal deposits, and the Union Pacific Railroad needed that coal to power its locomotives. The company employed 331 Chinese and 150 white miners, paying by the ton rather than by the hour. Chinese workers, often fleeing poverty and war at home, accepted lower wages than their European immigrant counterparts. White miners, many of them members of the Knights of Labor union, saw this as a deliberate corporate strategy to drive down wages and break strikes. They were right. Union Pacific found it economically beneficial to give preference to Chinese hires precisely because it weakened organized labor. The mines became a pressure cooker of class resentment channeled into racial hatred.

The morning started with a fight over coal. Chinese and white miners disputed who had the right to work a particularly desirable area of Mine No. 6. White miners beat two Chinese workers and walked off the job. By early afternoon, between 100 and 150 armed men, mostly miners and railroad workers, had gathered at the railroad tracks. Women and children joined them. Around two o'clock, the mob divided and moved toward Chinatown across a plank bridge over Bitter Creek. They looted homes and businesses, then set them ablaze. Chinese workers fled into the surrounding hills. Those who could not escape were shot in the streets or burned alive in their cellars. The fires consumed everything. By nightfall, Chinatown was gone.

At least 28 Chinese miners died, though the true number may never be known. Many bodies burned beyond recognition, and others perished from wounds, thirst, and exposure in the hills that night. The property damage reached approximately $150,000, equivalent to nearly $5 million today. A week later, U.S. troops escorted the surviving Chinese back into Rock Springs, where many returned to work in the same mines. Union Pacific fired 45 white miners for their roles in the violence, but no one was ever prosecuted for murder or arson. A grand jury blamed the Chinese for provoking the attack.

Chinese diplomats in New York and San Francisco compiled damage claims and demanded action. President Grover Cleveland addressed the massacre in his December 1885 State of the Union, declaring that race prejudice was the chief factor in the disturbances and calling for the full power of government to maintain good faith with China. The New York Times published multiple editorials condemning not only the rioters but the townspeople who stood by. Even the Knights of Labor leader Terence Powderly, while blaming lax enforcement of the Chinese Exclusion Act rather than the rioters themselves, acknowledged the violence was unacceptable. Congress ultimately appropriated $147,748.74 as an indemnity to China, a rare acknowledgment of governmental responsibility for mob violence against foreign nationals.

Rock Springs ignited a wave of anti-Chinese violence across the American West. Near Newcastle, Washington, a mob burned the barracks of 36 Chinese coal miners. In Tacoma, the entire Chinese community was expelled in early November, some marched out by force, their settlements torched. Incidents spread to Oregon and as far as Augusta, Georgia, where anti-Chinese sentiment found new voice. Historians consider the Rock Springs Massacre the most widely publicized act of anti-Chinese violence in 19th-century America. Today, the site of Chinatown lies beneath a public elementary school. The locations associated with the massacre have been absorbed by the city's growth, the evidence of that September day largely erased from the landscape but not from history.