It was only a year since Lorenzo Bandini had been killed at Monaco but the F1 circus had suffered the loss of both Jim Clark, Mike Spence. Bandini's accident the previous year had let to the chicane being tightened and the race being shortened by 20 laps. Ferrari did not attend amid reports that the team was not happy with the safety standards at the circuit. Team Lotus was there, however, and Graham Hill and Jackie Oliver ran in the new red and gold livery of Gold Leaf and the cars featured the first hints of aerodynamic front and rear wings. BRM had been planning to run Chris Irwin as Mike Spence's replacement but in practice for the Nürburgring 1000 the previous weekend Irwin had flipped an Alan Mann Ford F3L sportscar at Flugplatz and had suffered serious head injuries and so Reg Parnell Racing's Richard Attwood was promoted to the works team. Jackie Stewart was still out of action with a wrist injury from the Járama F2 race a month earlier and so his place in the Matra International team was taken by F1 debutante Johnny Servoz-Gavin. Jean-Pierre Beltoise appeared with the new Matra V12 engine in the back of his Matra Sports entry. Brian Redman was busy racing for Ford at the Spa 1000 and his place with Cooper was taken by Lucien Bianchi. Denny Hulme was also being kept busy as he jetted backwards and forwards to Indianapolis qualifying.

Qualifying at Monaco resulted in pole position by 0.6 secs for Hill with an impressive Servoz-Gavin alongside him on the front row. The second row featured Jo Siffert (in Rob Walker's Lotus) and John Surtees in the Honda with Brabham's Jochen Rindt and Attwood on the third row. Then came Bruce McLaren and Beltoise, Pedro Rodríguez (BRM) and Hulme.

At the start Servoz-Gavin took the lead but after three laps he suffered a driveshaft failure and crashed. This left Hill in the lead and there he stayed for the rest of the afternoon. The first few laps saw a number of accident with Oliver and McLaren colliding on the first lap, Jochen Rindt (Brabham) crashing on lap nine while trying to pass Surtees. Brabham, Dan Gurney and Siffert all went out with mechanical trouble while Beltoise broke his suspension running over a curb and Piers Courage (Reg Parnell Racing BRM) stopped because his car was handling so badly. Surtees then disappeared with a gearbox failure and on the same lap Rodríguez crashed and so only five cars were left by the end of lap 16. As a result the excitement was limited although third placed Hulme stopped in the mid-race to have a driveshaft replaced and dropped to fifth, leaving Bianchi to finish third behind Hill and Attwood with Ludovico Scarfiotti fourth in the second Cooper-BRM. It would be Scarfiotti's last Grand Prix as he was killed two weeks later in an accident on the Rossfeld hillclimb.