On the morning of 12 October 1978, Sid Vicious claimed to have awoken from a drugged stupor to find Nancy Spungen dead on the bathroom floor of their room in the Hotel Chelsea in Manhattan, New York. She had suffered a single stab wound to her abdomen and appeared to have bled to death. The knife used had been bought by Vicious on 42nd Street and was identical to a collector's knife given to punk rock vocalist Stiv Bators of the Dead Boys by Dee Dee Ramone. According to Dee Dee's wife at the time, Vera King Ramone, Sid had bought the knife after seeing Stiv's.
Vicious was arrested and charged with her murder. He said they had fought that night but gave conflicting versions of what happened next, saying, "I stabbed her, but I didn't mean to kill her. I loved her, but she treated me like shit", then saying that he did not remember and at one point arguing Spungen had fallen onto the knife.
On October 22, ten days after Spungen's death, Vicious attempted suicide by slitting his wrist and subsequently became a patient at Bellevue Hospital. He was charged with assault after an altercation with Todd Smith (singer Patti Smith's brother) at a Skafish concert. Vicious was arrested December 9, 1978 and sent to Rikers Island prison for 55 days. He was released on bail on February 1, 1979.
Bail was originally set at $50,000. However, after court hearings and work from his lawyer, it was lowered. Malcolm McLaren, the Sex Pistols' manager, worked to raise money, and the bond was eventually covered by Virgin Records.One theory regarding the murder is that Spungen was killed in a robbery or drug deal gone wrong, in which one of those involved was Rockets Redglare, later to become known as a stand-up comedian and actor. Redglare, who died in 2001, always denied any part in her death. He stated that the other dealer known to have been there that evening had left before him to obtain more heroin, and was due back after he had left the building. He said he believed that the other dealer returned, found Vicious out cold, and attempted to steal the remaining drugs, leading to a confrontation with Spungen.
On the evening of 1 February 1979, a small gathering to celebrate Sid's having made bail was held at the 63 Bank St. New York Apartment of his new girlfriend, Michelle Robinson, whom he had started dating the day he got out of Bellevue Hospital the previous October. Vicious was clean, having been on a detoxification methadone program detoxed from heroin during his time at Rikers Island. However, at the dinner gathering, his mother (who was once a registered addict herself) had some heroin delivered, against the wishes of Sid's girlfriend. The person who delivered it, Peter Kodick, came and stayed for a while. Vicious overdosed at midnight that night but everyone who was there that night worked together to get him up and walking around in order to revive him. At 3am Sid and Michelle Robinson went to bed together. Vicious was discovered dead late the next morning. An autopsy confirmed that Vicious died from an accumulation of fluid in the lungs that was consistent with heroin overdose. A syringe, spoon, and heroin residue were discovered near the body. It was theorized that he had injected himself with an excess of the nearly 80%-pure heroin. A few days after Vicious' cremation, his mother found a suicide note in the pocket of his jacket:
"We had a death pact, and I have to keep my half of the bargain. Please bury me next to my baby in my leather jacket, jeans and Motorcycle Boots. Goodbye."