The aircraft, a de Havilland Canada DHC-6 Twin Otter 300, impacted terrain on a gentle slope and was partially buried in snow.

The investigation determined that the accident was caused by the formation of ice on the wings combined with downdrafts associated with a mountain wave led to the aircraft's loss of control and impact with terrain.

[3] The aircraft involved in the accident was a 5-year-old de Havilland Canada DHC-6 Twin Otter 300, with registration N25RM and manufacturer serial number 387.

The crew reported that they encountered heavy rime icing during the descent into Steamboat Springs but the flight was otherwise smooth and without turbulence.

[3] Flight 217 departed from Steamboat Springs at 18:55, two hours and ten minutes behind schedule, and was cleared to climb to its assigned altitude of 17,000 ft (5,200 m).

Shortly before impact, the first officer advanced the engine levers to maximum takeoff go-around power, selected fully extended flaps, and told the captain to bank right.

[3] However, the aircraft's right wingtip impacted a high-voltage electrical tower, causing a short circuit and a power outage in the nearby town of Walden.

Despite the efforts of the least injured passengers, a 26-year-old female, one of the USFS employees on the flight, died of her injuries approximately 4 hours after the crash.

The same passenger who had winter survival training attempted to remove the snow around the first officer but was unsuccessful due to the violent winds.

[3][7] Rescuers from the Colorado Civil Air Patrol, the Routt County Sheriff Office, and personnel from the Steamboat Springs Airport were notified about the missing aircraft in the hours after the crash, and met together in Walden.

[5] The investigation was conducted by the National Transportation Safety Board (NTSB), with representatives from the Federal Aviation Administration, Rocky Mountain Airways, de Havilland Canada, the Air Line Pilots Association, and Pratt and Whitney.

[3] In a post-accident interview, First Officer Coleman told the NTSB that the aircraft's deicing and anti-icing systems were functioning properly during the flight.

The area, situated near and over a mountain range, allowed for atmospheric inversion, which led to the formation of freezing rain, snow, and ice pellets.

[10] The geography of the area, combined with the meteorological conditions at the time of the crash, was concluded to be conductive to the formation of a mountain wave.

[3] Certification data the NTSB acquired showed that under the icing conditions the flight encountered, the crew should have been able to maintain an altitude of 19,500 ft (5,900 m).

The NTSB speculated that if the captain did not know the strength of the tailwind and downdrafts, he might have believed that icing was the main cause for the inability to climb, and that might have influenced his decision to return.

[3] In regard to Captain's Klopfenstein's decision to fly, the NTSB concluded that he was not aware of the presence of the mountain wave(s) en route.

[3] In their final report, the NTSB concluded the probable cause of the accident was: Severe icing and strong downdrafts associated with a mountain wave which combined to exceed the aircraft's capability to maintain flight.

[3] The departure procedure for Steamboat Springs was changed to allow aircraft to gain more altitude flying westward before turning east over the mountains.

[8] In 2009, a memorial to the crash was unveiled at the Wings Over the Rockies Air and Space Museum by First Officer Coleman, many of the surviving 19 passengers, and several of the rescuers.