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Warm-up
The drivers took to the track in dry weather at 09:30 Central European Summer Time (UTC +1) for a 30-minute warm-up session following a spell of mist that fell on the circuit. He was six hundredths of a second faster than Häkkinen in warm-up's final seconds. No major incidents occurred during the session. Irvine spun at the second Lesmo right-hand turn but recovered and resumed driving. The conditions for the race were dry, warm and sunny, Every driver began on the medium compound tyre because it was three-tenths of a second faster than the hard compound tyre. The race saw more tyre blistering because compound wear was worsened by braking hard for the first chicane. Mechanics worked on Heidfeld's car who managed to get it to the side of the circuit before the formation lap began to avoid a penalty. Barrichello made a slow start on the inside and dropped from second to fifth place, leaving the fast starting Villeneuve stuck behind the Ferrari. Salo and Irvine collided into the first corner, and both drivers crashed into Diniz. Irvine retired with suspension damage, while Salo suffered a left-rear puncture and Diniz's front wing was removed.
A multi-car accident happened into the Variante della Roggia chicane (the second chicane). Barrichello attempted to pass Trulli on the inside as the following Frentzen on a light fuel load struck the left-rear corner of Trulli's vehicle with his right-front corner at nearly . Frentzen then hit the right-rear corner of Barrichello's Ferrari with his car's left-front corner. All three cars spun and collected Coulthard, who was trying to turn into the chicane.
The race was neither stopped or the start aborted by FIA race director Charlie Whiting to allow those involved in the crash to return to the pit lane and get into their spare cars. Watkins and Harstein were not informed of Gislimberti's condition because of erroneous initial reports and were not told to drive to the accident location until race control received word of Gislimberti's injuries. Salo became the fifth driver to pit on lap eight; his mechanics fitted a new engine cover and sidepods to correct handling problems. The wait for Harstein and Watkins in the medical car to return to their position at the pit lane exit after administering aid to Gislimberti and instructing marshals not to leave the stricken vehicles at the back of the gravel trap but to move them to a safer area extended the safety car period. He lost control of his car at the Parabolica curve because he had no steering and went into the gravel trap, retiring on lap 11. Häkkinen came in second 3.8 seconds later, ahead of Ralf Schumacher, who finished third for the second successive race. Verstappen took fourth, Wurz finished fifth, Michael Schumacher revealed that the reason for his emotion was because he was remembering Senna's death at the 1994 San Marino Grand Prix. He also expressed his surprise at the media's response, which said that Schumacher "was human after all." Häkkinen revealed that his team's adjustments to his car during his pit stop helped him set the race's fastest lap.
thumb|right|upright|[[Jenson Button (pictured in 2004) blamed Michael Schumacher for causing him to retire from the Grand Prix on lap 11.]]
Button blamed race leader Michael Schumacher catching him out for his retirement, asking: "I thought you weren't allowed to do that?" Villeneuve disagreed, saying: "Michael was only doing what you're meant to do in that situation. The guys behind should calm down." Zonta credited his car's speed with allowing him to finish sixth and overtake. He added that a better qualifying result would have allowed him to compete for a higher finishing position or a podium finish. Frentzen responded by suggesting that Barrichello braked too early, causing him to collide with teammate Trulli. Whiting defended his decision not to stop the race, saying that the safety car was deployed because all cars involved were in the run-off areas and that stopping the race would be dangerous. However, he admitted to being unaware of Gislimberti's condition when making the decision. Eddie Jordan, the Jordan team's principal, believed Whiting had made the right decision and applauded the modern Formula One car's safety for protecting drivers.
Bernie Ecclestone, the owner of Formula One's commercial rights, called for the removal of chicanes from racing circuits, calling them "silly and unnecessary". Mosley believed that no driver was to blame for the accident but emphasised to competitors that it was their responsibility to be attentive when bunched up at a race start. Former driver Jacques Laffite advocated for an electronic warning system for marshals and thought chicanes should have been reviewed.
Gislimberti never regained consciousness and was pronounced dead at hospital. His autopsy released two days later determined he died from head trauma. On 15 September, he was given a funeral at the San Ulderico church, Lavis, attended by several drivers, friends and colleagues. Five cars involved in the crash were impounded by Italian authorities hours after the race. Magistrate Salvatore Bellomo opened a formal investigation into the crash and interviewed drivers. The investigating body examined all five cars before returning them to the teams on 12 September. The investigation was closed in June 2001 after a technical study concluded that Gislimberti was killed instantly. Following Gislimberti's death, the strength of the wheel tethers was doubled to prevent flying tyres from endangering drivers, safety officials, and fans. The chassis would be reinforced, and improved crash resistance would be tested.
Michael Schumacher's victory reduced Häkkinen's lead in the World Drivers' Championship to two points. Coulthard remained in third with 61 points. Barrichello's retirement at the race ended his chances of becoming World Champion and Ralf Schumacher's third-place finish kept him in fifth place with 24 points.
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Championship standings after the race
;Drivers' Championship standings
{| class="wikitable" style="font-size: 85%;"
|-
! scope="col" |
! scope="col" |
! scope="col" | Driver
! scope="col" | Points
|-
|align="left"| 10px
| align="center" | 1
| Mika Häkkinen*
| 80
|-
|align="left"| 10px
| align="center" | 2
| Michael Schumacher*
| 78
|-
|align="left"| 10px
| align="center" | 3
| David Coulthard*
| 61
|-
|align="left"| 10px
| align="center" | 4
| Rubens Barrichello
| 49
|-
|align="left"| 10px
| align="center" | 5
| Ralf Schumacher
| 24
|-
!colspan=4|Sources:
|}
;Constructors' Championship standings
{|class="wikitable" style="font-size: 85%;"
|-
! scope="col" |
! scope="col" |
! scope="col" | Constructor
! scope="col" | Points
|-
|align="left"| 10px
| align="center" | 1
| McLaren-Mercedes*
| 131<!-- Please do not change this to 141 - McLaren (but not Häkkinen) were penalised 10 points at the Austrian GP due to a missing seal on Häkkinen's car, so McLaren's points total is NOT equal to the sum of Häkkinen's points plus Coulthard's points -->
|-
|align="left"| 10px
| align="center" | 2
| Ferrari*
| 127
|-
|align="left"| 10px
| align="center" | 3
| Williams-BMW
| 34
|-
|align="left"| 10px
| align="center" | 4
| Benetton-Playlife
| 20
|-
|align="left"| 10px
| align="center" | 5
| Jordan-Mugen-Honda
| 13
|-
!colspan=4|Sources: