We had the party disintegrate, though the player group was solid as ever.
Basically, in a campaign where we had all avowed that we'd all play characters neutral on the Good-Evil axis, a couple decided to slip in some Evil. A couple others decided to slip in some Good.
There was one gnome on each side of this divide (well one svirfneblin, and one surface gnome). Out of respect for gnomishness, they chose not to go after each other. They each had a "champion" (the champions were not aware of their role in all this), and the gnomes began pranking each other's champion.
As you can guess, things eventually got out of hand. Only the two gnomes survived. And neither one of them ever did anything actually lethal. We then went on to another campaign, having agreed that the evil thing wasn't so grand for us.