At the conclusion of the home and away season, Carlton had finished first on the VFL ladder with 19 wins and 3 losses. Collingwood had finished third (behind North Melbourne) with 15 wins and 7 losses.
In the finals series leading up to the Grand Final, Collingwood lost to North Melbourne in the Qualifying Final by 39 points before beating Fitzroy in the First Semi-Final by 22 points to progress to the Preliminary Final. There they faced North Melbourne once again, this time winning by 27 points to advance to the Grand Final. Carlton had a much easier finals run, defeating North Melbourne by 38 points in the Second Semi-Final to advance straight through to the Grand Final.
The game was played in rainy and muddy conditions. Collingwood planned to grind Carlton into the mud, and managed to take a 10-point lead into quarter time, keeping Carlton goalless. Twenty minutes into the second quarter, Collingwood had stretched their lead to 28 points. Carlton still hadn't scored a goal, and with the conditions only getting heavier, things were looking promising for the Magpies. Seemingly in desperation, Alex Jesaulenko moved himself out of the centre and brought in young pocket battleship Wayne Harmes. Suddenly, Carlton sparked into life, as goals to Harmes, Maclure, Johnston and Buckley saw the Blues grab the lead at half time by one point. Carlton capitalized on their momentum, scoring five goals to two and taking a 21-point lead at three quarter time. However, 18 minutes into the final quarter, the Blues' lead had been slashed to four points, with the Magpies having kicked the last three goals of the game.
Then occurred one of the most memorable moments in VFL/AFL history. With Carlton kicking to the City End, Harmes gathered the ball on the half-forward flank and hurried a kick forward. The kick floated into the right forward pocket, with no player from either team in the vicinity. Harmes chased his own kick as the ball bounced towards the boundary line, and dived to punch the ball back into play before the ball went over the line. Harmes' punch directed the ball into the goal square, where Ken Sheldon, who was running forward at the time, was able to gather the ball and score a goal, giving Carlton a ten-point buffer. Many Collingwood fans maintain to this day that the ball was out of bounds before Harmes punched it back in. The incident was one of the first two recreated for the Toyota Memorable Moments series of advertisements.
A successful left-foot snap by Collingwood centre half-forward Allan Edwards lifted the hopes of the Magpie army, but from the resultant bounce Carlton managed to move the ball forward where substitute Alex Marcou scored a point. Moments later, the siren sounded.
The inaugural Norm Smith Medal was awarded to Harmes for being judged the best player afield, much to the chagrin of Collingwood supporters who were still ranting about that goal, as well as the fact that Harmes was a grand-nephew of Norm Smith. However, it was Harmes who helped spark the second-quarter comeback when all seemed lost for Carlton.
Carlton's Alex Jesaulenko became the last ever player to captain-coach a team to victory in a Grand Final. During the final quarter he injured his ankle and had to leave the field on a stretcher.