The first of the rule changes announced by the FIA at Monaco came into effect, amid much controversy. While testing at Silverstone Pedro Lamy's Lotus had lost its rear wing and the Portuguese driver had been seriously injured when the car vaulted the barriers. He was replaced in Barcelona by Alex Zanardi. Williams had named test driver David Coulthard as its replacement for the late Ayrton Senna but there were negotiations for Nigel Mansell to take the drive later in the year when he did not have clashing CART races in America. Simtek had replaced Roland Ratzenberger with Italian Andrea Montermini but Sauber was running only one car as Karl Wendlinger was still in a coma following his crash at Monaco. Eddie Irvine was back in the second Jordan, his three-race ban having ended. It was imposed due to dangerous driving in Brazil.

The fight over the new regulations saw Benetton boss Flavio Briatore trying to force the issue by saying that he could not guarantee the safety of the Mild Seven Benetton Fords. The FIA promptly threw the team out of the meeting and Briatore had to back down. On Friday morning only nine cars went out to practice while the team bosses had meetings to try to solve the crisis. By Saturday things had quietened down but there was another scare when Montermini piled his Simtek into the wall at around 100mph. It looked serious and Montermini was taken off to hospital.

In the afternoon Michael Schumacher took pole in his Benetton while Damon Hill (Williams-Renault) knocked Mika Häkkinen (McLaren-Peugeot) back to third place with the second Benetton of J.J. Lehto fourth on the grid. Rubens Barrichello held on to fifth in his Jordan-Hart ahead of the Ferraris of Jean Alési and Gerhard Berger. The top 10 was completed by Martin Brundle (McLaren-Peugeot), Coulthard and Ukyo Katayama (Tyrrell-Yamaha).

At the start of the race Schumacher led Hill and Häkkinen into the first corner. Barrichello ran into Berger and dropped the Austrian to 12th place. Schumacher began to pull away in dominant fashion leaving Hill and Häkkinen to fight over second place ahead of Alési, Lehto, Coulthard, Barrichello and Brundle. Coulthard retired with electrical problems when the pit stops began and Berger also disappeared with a gearbox problem.

As the stops were taking place Schumacher began to have gear selection problems. The car was stuck in fifth gear but somehow Schumacher pitted and rejoined in the lead without stalling. He was overtaken by Häkkinen on lap 23 with Hill second and Schumacher third.

Häkkinen pitted again and so Hill went ahead with Schumacher second. Häkkinen was clawing his way back while Lehto was a lonely fourth ahead of Brundle and Irvine. When the others pitted Schumacher went ahead again. Once again Michael completed a pit stop with only fifth gear. This put Hill back in the lead but Schumacher was only a few seconds behind with Häkkinen shadowing him. The Finn was right behind the Benetton when his engine blew on lap 48. Lehto inherited third but his engine also hit trouble and he dropped away to retire.

This put Brundle up to third, half a minute behind Schumacher, who was slipping further and further behind Hill, but he retired close to the finish and so Blundell took third for Tyrrell with Irvine and Pierluigi Martini (Minardi) picking up the remaining points.