Flight 401 departed JFK Airport in New York on Friday, December 29, 1972, at 21:20 EST, with 163 passengers and 13 crew members on board.

The flight was routine until 23:32, when the plane began its approach into Miami International Airport. After lowering the gear, First Officer Stockstill noticed that the landing gear indicator, a green light identifying that the nose gear is properly locked in the "down" position, had not illuminated. This was later discovered to be due to a burned-out light bulb. The landing gear could have been manually lowered, nonetheless. The pilots cycled the landing gear, but still failed to get the confirmation light.

Loft, who was working the radio during this leg of the flight, told the tower that they would discontinue their approach to their airport and requested to enter a holding pattern. The approach controller cleared the flight to climb to 2,000 ft (610 m), and then hold west over the Everglades.

The cockpit crew removed the light assembly, and Second Officer Repo was dispatched to the avionics bay beneath the flight deck to confirm via a small porthole if the landing gear was indeed down. Fifty seconds after reaching their assigned altitude, Captain Loft instructed First Officer Stockstill to put the L-1011 on autopilot. For the next 80 seconds, the plane maintained level flight. Then, it dropped 100 ft (30 m), and then again flew level for two more minutes, after which it began a descent so gradual it could not be perceived by the crew. In the next 70 seconds, the plane lost only 250 ft (76 m), but this was enough to trigger the altitude warning C-chord chime located under the engineer's workstation. The engineer (Repo) had gone below, and no indication was heard of the pilots' voices recorded on the CVR that they heard the chime. In another 50 seconds, the plane was at half its assigned altitude.

As Stockstill started another turn, onto 180°, he noticed the discrepancy. The following conversation was recovered from the flight voice recorder later:Stockstill: We did something to the altitude.Loft: What?Stockstill: We're still at 2,000 feet, right?Loft: Hey—what's happening here?

Less than 10 seconds after this exchange, the jetliner crashed:Cockpit area microphone (CAM): [Sound of click]CAM: [Sound of six beeps similar to radio altimeter increasing in rate]CAM: [Sound of initial impact]

The location was west-northwest of Miami, 18.7 mi (30.1 km) from the end of runway 9L. The plane was traveling at 227 miles per hour (197 kn; 365 km/h) when it hit the ground. With the aircraft in mid-turn, the left wingtip hit the surface first, then the left engine and the left landing gear, making three trails through the sawgrass, each 5 ft (1.5 m) wide and over 100 ft (30 m) long. When the main part of the fuselage hit the ground, it continued to move through the grass and water, breaking up as it went.

The TriStar's port outer wing structure struck the ground first, followed by the No. 1 engine and the port main undercarriage. The disintegration of the aircraft that followed scattered wreckage over an area 1,600 ft (500 m) long and 330 ft (100 m) wide in a southwesterly direction. Only small fragments of metal marked the wingtip's first contact, followed 49 ft (15 m) further on by three massive 115 ft (35 m) swaths cut through the mud and sawgrass by the aircraft's extended undercarriage before two of the legs were sheared off. Then came scattered parts from the No. 1 (port) engine, and fragments from the port wing itself and the port tailplane. About 490 feet (150 m) from the wingtip's initial contact with the ground, the massive fuselage had begun to break up, scattering components from the underfloor galley, the cargo compartments, and the cabin interior. At 820 ft (250 m) along the wreckage trail, the outer section of the starboard wing tore off, gouging a 59-foot-long (18 m) crater in the soft ground as it did so. From this point on, the breakup of the fuselage became more extensive, scattering metal fragments, cabin fittings, and passenger seats widely.

The three major sections of the fuselage—the most intact of which was the tail assembly—lay in the mud towards the end of the wreckage trail. The fact that the tail assembly—rear fuselage, No. 2 tail-mounted engine, and remains of the empennage—finally came to rest substantially further forward than other major sections, was probably the result of the No. 2 engine continuing to deliver thrust during the actual breakup of the aircraft. No complete cross-section of the passenger cabin remained, and both the port wing and tailplane were demolished to fragments. Incongruously, not far from the roofless fuselage center section with the inner portion of the starboard wing still attached, lay a large, undamaged and fully inflated rubber dinghy, one of a number carried on the TriStar in the event of an emergency water landing. The breakup of the fuselage had freed it from its stowage and activated its inflation mechanism.

Robert "Bud" Marquis (1929–2008), an airboat pilot, was out frog gigging with Ray Dickinsin (1929–1988) when they witnessed the crash. They rushed to rescue survivors. Marquis received burns to his face, arms, and legs—a result of spilled jet fuel from the crashed TriStar—but continued shuttling people in and out of the crash site that night and the next day. For his efforts, he received the Humanitarian Award from the National Air Disaster Alliance/Foundation and the "Alumitech – Airboat Hero Award", from the American Airboat Search and Rescue Association.

In all, 75 survived the crash—67 of the 163 passengers and eight of the 10 flight attendants. Despite their own injuries, the surviving flight attendants were credited with helping other survivors and several quick-thinking actions such as warning survivors of the danger of striking matches due to jet fuel in the swamp water and singing Christmas carols to keep up hope and draw the rescue teams' attention, as flashlights were not part of the standard equipment on commercial airliners at the time. Of the cockpit crew, only flight engineer Repo survived the initial crash, along with technical officer Donadeo, who was down in the nose electronics bay with Repo at the moment of impact. Stockstill was killed on impact, while Captain Loft died in the wreckage of the flight deck before he could be transported to a hospital. Repo was evacuated to a hospital, but later succumbed to his injuries. Donadeo, the lone survivor of the four flight-deck occupants, recovered from his injuries. Frank Borman, a former NASA astronaut and Eastern's senior vice president of operations, was awoken at home by a phone call explaining of a probable crash. He immediately drove to Eastern's Miami offices and decided to charter a helicopter to the crash site as the swampy terrain made rescue difficult and Eastern had not heard any news of progress in rescue efforts. There he was able to land in a swampy patch of grass and coordinate rescue efforts. He accompanied 3 survivors on the helicopter to the hospital including a flight attendant and passenger who lost her baby in the crash.

Most of the dead were passengers in the aircraft's midsection. The swamp absorbed much of the energy of the crash, lessening the impact on the aircraft. The mud of the Everglades may have blocked wounds sustained by survivors, preventing them from bleeding to death. However, it also complicated the survivors' recuperation, as organisms in the swamp caused infection, with the potential for gas gangrene. Eight passengers became infected; doctors used hyperbaric chambers to treat the infections. All the survivors were injured; 60 received serious injuries and 17 suffered minor injuries that did not require hospitalization. The most common injuries were fractures of ribs, spines, pelvises, and lower extremities. Fourteen survivors had various degrees of burns.

The National Transportation Safety Board (NTSB) investigation discovered that the autopilot had been inadvertently switched from altitude hold to control wheel steering (CWS) mode in pitch. In this mode, once the pilot releases pressure on the yoke (control column or wheel), the autopilot maintains the pitch attitude selected by the pilot until he moves the yoke again. Investigators believe the autopilot switched modes when the captain accidentally leaned against the yoke while turning to speak to the flight engineer, who was sitting behind and to the right of him. The slight forward pressure on the stick would have caused the aircraft to enter a slow descent, maintained by the CWS system.

Investigation into the aircraft's autopilot showed that the force required to switch to CWS mode was different between the A and B channels (15 vs. 20 lbf or 6.8 vs. 9.1 kgf, respectively). Thus, the switching to CWS in channel A possibly did not occur in channel B, thus depriving the first officer of any indication the mode had changed (channel A provides the captain's instruments with data, while channel B provides the first officer's).

After descending 250 feet (76 m) from the selected altitude of 2,000 feet (610 m), a C-chord sounded from the rear speaker. This altitude alert, designed to warn the pilots of an inadvertent deviation from the selected altitude, went unnoticed by the crew. Investigators believe this was due to the crew being distracted by the nose gear light, and because the flight engineer was not in his seat when it sounded, so would not have been able to hear it. Visually, since it was nighttime and the aircraft was flying over the darkened terrain of the Everglades, no ground lights or other visual signs indicated the TriStar was slowly descending.

Captain Loft was found during the autopsy to have an undetected brain tumor, in an area that controls vision. However, the NTSB concluded that the captain's tumor did not contribute to the accident.

The final NTSB report cited the cause of the crash as pilot error, specifically: "the failure of the flight crew to monitor the flight instruments during the final four minutes of flight, and to detect an unexpected descent soon enough to prevent impact with the ground. Preoccupation with a malfunction of the nose landing gear position indicating system distracted the crew's attention from the instruments and allowed the descent to go unnoticed."

In response to the accident, many airlines started crew resource management training for their pilots. The training is designed to make problem solving in a cockpit much more efficient, thus causing less distraction for the crew. Flashlights are now standard equipment near jumpseats, and all jumpseats are outfitted with shoulder harnesses.