At the start of the race Mika Hakkinen makes a great start to lead the field into the first corner with David Coulthard chasing him. Jacques does not get away well and drops behind both Ralf Schumacher and Damon Hill. Jacques passes Hill in the course of the first lap to take fourth place. Further back Alexander Wurz makes a very bad start and drops to the tail of the field while Olivier Panis jumps the start and is later given a 10 second penalty.

Behind Villeneuve Hill runs fifth with the two Ferraris chasing, Eddie Irvine leading Michael Schumacher. They are shadowed by Giancarlo Fisichella and Heinz-Harald Frentzen. As the order settles at the front Rubens Barrichello manages to get past Johnny Herbert for 11th place, a move which suggests that the Brazilian is racing to a one-stop strategy.

Ralf Schumacher also looks like a two-stop racer as he is able to keep up with the McLarens in the early laps, trading fastest lap with Hakkinen and Coulthard. On the third lap Irvine goes off the circuit at the Ostkurve and Michael Schumacher moves to sixth place with Irvine behind him. Further back Pedro Diniz retires with a hydraulic problem.

In the early laps the order remains stable except for Wurz moving past Mika Salo, Jos Verstappen and Jarno Trulli.

Ralf Schumacher stays with the McLarens until lap 14 when he pits for fuel and tyres. He drops to ninth place, while Villeneuve is promoted to third and manages to maintain the same pace as the McLarens. Barrichello also pits and drops back to 15th.

Most of the field choose a one-stop strategy and the mid-race stops begin on lap 21 with Jean Alesi coming in. He is followed on lap 22 by Fisichella, Frentzen and Herbert and on lap 23 by Villeneuve, Hill and Wurz. Michael Schumacher and Irvine pit on laps 24 and 25 while Hakkinen and Coulthard stop on laps 26 and 27. Coulthard's stop is slightly quicker than Hakkinen's and he emerges right on Hakkinen's tail, despite overshooting his pit slightly.

The only major change to the order is that Irvine slips behind Ralf Schumacher and Fisichella. Eddie tries to pass Giancarlo for the rest of the race. Ralf drops back to sixth place with his second pit stop on lap 29. While the stops are going on Jos Verstappen retires with transmission problems and Barrichello goes out with gearbox overheating.

In the last few laps Hakkinen's car begins to lose power and Coulthard gets closer while Villeneuve closes the gap dramatically until something breaks in his car and the car becomes very difficult to handle. He is forced to back off leaving the two McLarens to come home 1-2.

Villeneuve is a delighted third with Hill fourth, Michael Schumacher fifth and Ralf sixth. Irvine chases Fisichella all the way to flag while Frentzen comes home eighth ahead of Alesi. Wurz is the last unlapped runner, while Trulli is 12th. On the penultimate lap Salo passes Takagi for 13th place but he loses third gear on the last lap and is repassed by the Tyrrell driver.

Hakkinen increases his lead in the World Championship to 16 points.