Between June 3 and June 6, 1984, the Indian Army under the instruction of Indira Gandhi brought troops into the Harmandir Sahib to arrest Jarnail Singh Bhindranwale. He and some followers had taken refuge in the Harmandir Sahib, and resisted the police who sought to arrest him for suspected acts of terrorism.

The Harmandir Sahib compound and some of the surrounding houses were fortified. The Statesman reported on July 4 that light machine-guns and sophisticated self-loading rifles were known to have been brought into the compound.

Indira Gandhi ordered the army to launch Operation Blue Star, and fierce fighting ensued between Bhindranwale's supporters and the soldiers. Many of Bhindranwale's supporters were killed along with many soldiers and many visitors to the site who had been kept from leaving the complex once the attack got under way. An official account tallies the deaths of 83 soldiers and 492 civilians.[6] The Harmandir Sahib complex also suffered much damage due to the fighting, especially the holy Sri Akal Takhat Sahib.

Indira Gandhi was reported to have said to General Vaidya during Operation Bluestar "I want Bhindranwale dead." Many Sikhs regarded the attack as a desecration of their holiest shrine. Indira Gandhi was assassinated by two of her bodyguards, both Sikhs, the following October.

In 1986 the repairs performed on the holy Sri Akal Takhat Sahib, which the Rajiv Gandhi Government had undertaken without consultation, were removed. A new Sri Akal Takhat Sahib was completed in 1999 by pilgrims who provided free services and labor.