While there were other incidents (detailed in Game Wizards, and leading to TSR having a rapid response team) the primary one that began to become an issue for D&D was the death of Irving Lee Pulling in 1982; his mother, Patricia Pulling, blamed D&D for his death. She sued a school principal and TSR- all cases were dismissed.
I've made Pulling the butt of some jokes in the past, but as I've gotten older I started feeling more sympathy for her. To lose a child is difficult enough, but when it's suicide it can be especially difficult. Was there something I could have done? Was there something I missed? I can't help but think Pulling was clinging to something that would bring meaning to her life after the devastating loss of her child. It would have been nice if she could have channeled that drive into something more constructive and ultimately healthier for her own mental wellbeing.
This became the basis for the later book and movie, Mazes and Monsters.
You might be interested in checking into the Satanic Panic documentary made by Sylvester Stallone called
Cobra. It's all about a Satanic cult called "The New World" who even have members in the police department.
The Satanic Panic had a massive impact despite not causing the 1984 crash, and I hope that people use the comments (if they chose to) to tell any stories that they might have.
In sixth grade I was reading Keep on the Borderlands in the cafeteria and one of my teachers said something like, "I don't think you're supposed to have that here." But she didn't stop me from reading it, take it away, or even continue with the conversation. When I was in 4th grade, my mother sent me to a neighbor's house to be babysat while she was at work during the summer. The lady babysitting me wouldn't let me watch Thundercats or some other cartoons because they were Satanic. Later, when I started playing AD&D, my parents would ask me, "Are you guys playing your Satanic game today?" When I'd answer yes they'd tell me to have fun.
When I worked at a museum, we would sometimes allow ghost hunters to show up at night to do what they do best. While I found them a bit goofy, they always treated the building with respect and would make a nice donation, so I didn't mind. One day they had a guest speaker who used to be a police officer in a small town here in Arkansas during the 1980s. At the start of his lecture he mentioned all those "occult based crimes during the 1980s" and my immediate thought was there were no such things. I kept my mouth shut because I wasn't really invited to speak, but there are still people today who are convinced we were awash in occult crimes during that time.