The Wounded Knee Massacre, also known as the Battle of Wounded Knee, involved nearly three hundred Lakota people killed by soldiers of the United States Army. More than 250 and up to 300 Lakota people were killed and 51 wounded (4 men and 47 women and children, some of whom died later). Twenty-five U.S. soldiers were killed and 39 were wounded (six of the wounded later died). Nineteen soldiers were awarded the Medal of Honor specifically for Wounded Knee, and overall 31 for the campaign.

The event, which was part of what the U.S. military called the Pine Ridge Campaign, occurred on December 29, 1890, near Wounded Knee Creek (Lakota: Čhaŋkpé Ópi Wakpála) on the Lakota Pine Ridge Indian Reservation in South Dakota, following a botched attempt to disarm the Lakota people at the camp. The previous day, a detachment of the U.S. 7th Cavalry Regiment commanded by Major Samuel M. Whitside approached Spotted Elk's band of Miniconjou Lakota and 38 Hunkpapa Lakota near Porcupine Butte and escorted them five miles (eight kilometers) westward to Wounded Knee Creek, where they made camp. The remainder of the 7th Cavalry Regiment, led by Colonel James W. Forsyth, arrived and surrounded the encampment. The regiment was supported by a battery of four Hotchkiss mountain guns. The Army was catering to the anxiety of settlers who called the conflict the Messiah War and were worried the ceremonial Ghost Dance signified a potentially dangerous Sioux resurgence. Historian Jeffrey Ostler wrote in 2004, "Wounded Knee was not made up of a series of discrete unconnected events. Instead, from the disarming to the burial of the dead, it consisted of a series of acts held together by an underlying logic of racist domination."

On the morning of December 29, the U.S. Cavalry troops went into the camp to disarm the Lakota. One version of events maintains that during the process of disarming the Lakota, a deaf tribesman named Black Coyote was reluctant to give up his rifle, claiming he had paid a lot for it. Black Coyote's rifle went off at that point, and the soldiers began firing on the Lakota. The Lakota warriors fought back, but many had already been disarmed.

In 2001, the National Congress of American Indians passed two resolutions condemning the military awards and called on the federal government to rescind them. The Wounded Knee Battlefield, the site of the massacre, was designated a National Historic Landmark by the U.S. Department of the Interior. In 1990, both houses of the U.S. Congress passed a resolution on the historical centennial formally expressing "deep regret" for the massacre.

In the years leading up to the conflict, the U.S. government had continued to seize Lakota lands. The once-large bison herds of the Great Plains, a staple of the Plains Indians, had been hunted to near-extinction. Treaty promises to protect reservation lands from encroachment by settlers and gold miners were not implemented as agreed. As a result, there was unrest on the reservations. During this time, news spread among the reservations of a Paiute prophet named Wovoka, founder of the Ghost Dance religion. He had a vision that the Christian Messiah, Jesus Christ, had returned to Earth in the form of a Native American.

According to Wovoka, the white invaders would disappear from Native lands, the ancestors would lead them to good hunting grounds, the buffalo herds and all the other animals would return in abundance, and the ghosts of their ancestors would return to Earth. They would then live in peace. All this would be brought about by the performance of the slow and solemn Ghost Dance, performed as a shuffle in silence to a single drumbeat. Lakota ambassadors to Wovoka, Kicking Bear and Short Bull, taught the Lakota that while performing the Ghost Dance, they would wear special Ghost Dance shirts, as had been seen by Black Elk in a vision. Kicking Bear misunderstood the meaning of the shirts, and said that the shirts had the power to repel bullets. Some tribes, including the Sioux, believed that a great earthquake and flood would occur which would drown all the whites.

The Ghost Dance movement was a result of the slow but ever-present destruction of the Native Americans' way of life. Tribal land was being seized at alarming rates. The once numerous bison herds were nearly hunted to extinction. The entire livelihood of the plains tribes revolved around the bison, and without the resources the animal offered, their cultures rapidly lost stability and security. This forced them to rely on the United States government to provide rations and goods, or else face starvation. The way of life of these independent people was rapidly fading. The Ghost Dance brought hope: the white man would soon disappear; the buffalo herds would return; people would be reunited with loved ones who had since died; the old way of living before the white man would return. This was not just a religious movement but a response to the gradual cultural destruction.

U.S. settlers were alarmed by the sight of the many Great Basin and Plains tribes performing the Ghost Dance, worried that it might be a prelude to armed attack. Among them was the U.S. Indian agent at the Standing Rock Agency where Chief Sitting Bull lived. U.S. officials decided to take some of the chiefs into custody in order to quell what they called the "Messiah craze". The military first hoped to have Buffalo Bill—a friend of Sitting Bull—aid in the plan, to reduce the chance of violence. Standing Rock agent James McLaughlin sent the Indian police to arrest Sitting Bull.^{[unreliable source]}