In the middle of a turn, at 08:45, Audacious ran upon a mine laid by the German auxiliary minelayer Berlin off Tory Island. The explosion occurred 16 feet (4.9 m) under the bottom of the ship, approximately 10 feet (3.0 m) forward of the transverse bulkhead at the rear of the port engine room.

The port engine room, machine room, X turret shell room and compartments below them flooded immediately, with water spreading more slowly to the central engine room and adjoining spaces.

At 20:45, with the decks underwater, the ship heeled sharply, paused, and then capsized. The ship floated upside down with the bow raised until 21:00, when an explosion occurred throwing wreckage 300 feet (91 m) into the air, followed by two more. The explosion appeared to come from the area of B magazine and was possibly caused by high-explosive shells falling from their racks and exploding, then igniting the cordite magazine.

A piece of armour plate fell on and killed a petty officer on Liverpool, which was 800 yd (730 m) away. This was the only casualty in connection with the sinking