The Governor of Galidraan had secretly been hiding the Mandalorian Death Watch splinter group on his world. He was also facing an insurrection by some of his colonists, so he hired the True Mandalorians under Jango Fett to eliminate the rebels, which they did. However, under the advice of the Death Watch leader, Vizsla, he also informed the Jedi Council that a group of Mandalorians were murdering "political activists."
The Jedi deflect the first blaster shots from the Mandalorians.
A unit of Jedi under MasterDooku were dispatched to Galidraan; no sooner had the True Mandalorians completed their work for the governor than the Jedi arrived and ordered them to stand down, which Fett refused to do. This resulted in a bloody stand-off.
As the battle commenced the Mandalorians switched to projectile weapons. Myles–Fett's aide-de-camp–decided to provide Fett with air support using his jetpack but a Jedi used force jump to reach him and cut him in half. That pushed Fett over the edge and he killed five Jedi with his bare hands. At the same time Komari Vosa aggressively cut down many Mandalorians. Fett confronted the Jedi who killed Myles. After Fett launched himself at the unknown Jedi they had a brief fight before Jango killed him. Jango was then captured by Dooku and the Jedi.
The casualties on both sides were heavy, with Jango being one of the only two survivors out of at least three hundred Mandalorians. The Jedi handed Jango over to the Governor of Galidraan, and the other Mandalorian was sold into slavery.
Dooku would later reflect that "It was a misguided mission from the start and not the first of the Council's poor decisions" and was one of the main reasons he chose to leave the Jedi Order. About 10 years before the battle of Geonosis, a Mandalorian named Silas was captured by Count Dooku and tortured when he refused to provide information regarding Jango Fett. Eventually, he broke under the torment. After listening to his story, Dooku ordered Silas' death.
In later years, the Battle of Galidraan would become used as a euphemism for a militaristic debacle, and in the aftermath of the Yinchorri Uprising it was used as an example by Finis Valorum of why the Jedi could not serve as the Republic's army.
The New Essential Guide to Characters states that the Jedi outnumbered the Mandalorians and that Jango Fett was not captured after the fight. Both statements are contradicted by other sources on the battle.
While the True Mandalorian Silas offers to tell Dooku about this battle under torture, there's no evidence he was actually there, and circumstantial evidence, (such as a later statement by Dooku that every Mandalorian but Jango died there) that he was not.