Essentially, it boiled down to a conflict between Franz Josef Strauß, then Federal Minister of Defense, and Rudolf Augstein, owner and editor-in-chief of Der Spiegel magazine, Germany's leading weekly political magazine. The affair would cost Strauß his office and put the young German democracy to a first major test.
The two had clashed already a year earlier, when, in 1961, Spiegel raised accusations of bribery in favor of the FIBAG construction company, who had received a contract for building military facilities. However, a parliamentary enquiry then found no evidence against Strauß.
The magazine was accused of treason. At 9 p.m. on October 26, 1962, the magazine's offices in Hamburg were seized and (together with the houses of several journalists) searched by 36 policemen, and thousands of documents were confiscated. The offices would remain shut down for weeks. Augstein and the then-editors-in-chief Claus Jacobi and Johannes Engel were arrested. The author of the article, Conrad Ahlers, who was vacationing in Spain, was seized in his hotel during the night. Augstein would be jailed for 103 days.
While Bundeskanzler Konrad Adenauer was informed of Strauß' actions, the Minister of Justice, belonging to the smaller coalition party FDP, was deliberately left out of all decisions. The injustice of the arrest caused riots and protest through all of Germany. Strauß initially denied all involvement even before the Bundestag, and Adenauer, in another speech, famously complained about an "abyss of state treason" ("Abgrund von Landesverrat").
However, Strauß was finally forced to admit that he had himself phoned the German military attaché in Madrid and urged him to arrest Ahlers. This was clearly illegal – as Minister of the Interior Hermann Höcherl famously paraphrased, "etwas außerhalb der Legalität" ("slightly beyond legality"). Since Strauß had thus lied to the parliament, on November 19, the five FDP ministers of the cabinet resigned, demanding that Strauß and Höcherl be fired. This put Adenauer himself at risk, who found himself publicly accused of backing the put-down of a critical press with the resources of the state.
On November 26, the police ended its occupation of the Spiegel offices, while the Augstein, Ahlers and three others remained under arrest – Augstein until February 7, 1963. In December 1962 Adenauer formed a new cabinet without Strauß.
On May 13, 1965 the Bundesgerichtshof (highest German court of appeals) refused to open trial against Augstein and Ahlers, ruling that during the affair Strauß had violated the boundaries and committed Freiheitsberaubung (deprivation of personal freedom); however, because of his belief of acting lawfully (Verbotsirrtum), he was exempt from punishment. The case also came before the Federal Constitutional Court of Germany, which issued a groundbreaking ruling that laid down the basics of the freedom of the press for decades to come.
The scandal temporarily halted Strauß' political career and was remembered by many when Strauß ran for Bundeskanzler in 1980, clearly losing against his SPD opponent (and incumbent) Helmut Schmidt. However, it is mostly remembered for altering the political culture of post-war Germany and – with the first mass demonstrations and public protests – being a turning point from the old Obrigkeitsstaat to a modern democracy.