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In 1915, the new federal Seamen's Act had been passed because of the RMS Titanic disaster three years earlier. The law required retrofitting of a complete set of lifeboats on the Eastland, as on many other passenger vessels.[7] This additional weight, ironically, probably made the Eastland more dangerous as it worsened the already severe problem of being top-heavy. Some argued that other Great Lakes ships would suffer from the same problem.[7] Nonetheless, it was signed into law by President Woodrow Wilson. The Eastland was already so top-heavy that it had special restrictions concerning the number of passengers that could be carried. Prior to that, in June 1914, the Eastland had again changed hands, this time bought by the St. Joseph and Chicago Steamship Company, with Captain Harry Pedersen appointed the ship's master.

On the fateful morning, passengers began boarding the Eastland on the south bank of the Chicago River between Clark and LaSalle Streets around 6:30, and by 7:10 a.m., the ship had reached its capacity of 2,572 passengers. The ship was packed, with many passengers standing on the open upper decks, and began to list slightly to the port side (away from the wharf). The crew attempted to stabilize the ship by admitting water to its ballast tanks, but to little avail. Sometime in the next 15 minutes, a number of passengers rushed to the port side, and at 7:28, the Eastland lurched sharply to port, and then rolled completely onto its side, coming to rest on the river bottom, which was only 20 feet below the surface. Many other passengers had already moved below decks on this relatively cool and damp morning to warm up before the departure. Consequently, hundreds were trapped inside by the water and the sudden rollover; others were crushed by heavy furniture, including pianos, bookcases, and tables. Although the ship was only 20 feet from the wharf, and in spite of the quick response by the crew of a nearby vessel, the Kenosha, which came alongside the hull to allow those stranded on the capsized vessel to leap to safety, a total of 844 passengers and four crew members died in the disaster.