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Your party has had a streak of bad luck and/or made a poor choice and are now staring down death. The rules were followed to the letter and loss is assured. How do you handle this as a GM?
Does story trump rules? If you give them a means to pull out of the situation it could lead to the party feeling that nothing will ever beat them.
Do the rules trump the story? The party may feel cheated and may lose interest in making new characters.
I think this all depends on your group(I'd say this is the biggest factor), the game you're playing, and the tone you've had since the beginning of the game.
If your party's willing to accept a TPK, then you can either start a new campaign, have them roll up new characters that pick up where the group left off, or have them fight their way out of hell (if the game has it, or you want to make it up).
Otherwise, like Stefano said, you can say "it was all a dream". I read a blog post a while back (can't find the link) that described how he did this with his party, and they were actually playing in a "flashforward", so when the combat ended and they were all dead, the group was actually speaking with an oracle, and the oracle had been showing them what dangers lay ahead of them. The group then knew what kinds of things would show up in their next encounter, and be more prepared for it. Useful if you kill the party with an encounter you accidentally made too difficult.
Other options are having the combat get interrupted; having the attackers get distracted, allowing the party to flee. A TPK can really add a lot to your storyline. You could say some powerful magic user comes along and raises them, and the party is now in their debt. Where you go with it depends on your story.
If you don't want to have a TPK, don't use a system that can TPK. Seriously. If you're running something really storyline heavy that'll get totally derailed if everyone dies, use something like 4e D&D that has a lot of anti-character-death fail-safes built into the rules. For old school D&D, the Table of Death and Dismemberment can be a good option for keeping the odds of TPK fairly low. But even those options are pushing it if you're concerned that the game will get badly messed up by a TPK situation. Honestly, with that kind of group and that kind of game, I might just declare that in a situation where the system would say that the character "dies," they're knocked out instead. Or, heck, just run a game without a whole lot of combat in it.
As a general rule, in fact, I'd talk to the party ahead of time about what would happen if one or all of the characters died, and whether they're okay with that. They might be completely cool with the idea of a TPK (and even see it as a chance to go at the same set of problems from another angle with new characters), in which case, go ahead and run old school D&D or Shadowrun or something else where the odds of that happening are pretty good. Likewise, they might be okay with a TPK if they knew that all that meant was that they would have to fight their way out of hell, or end up working for the wizard who resurrected them. (Perhaps with new post-resurrection powers/side-effects to boot.) Or they might be uncomfortable with the entire idea of a TPK, and prefer to know that death is off the table entirely as far as game consequences go.
I do say that as a player who finds few things more annoying than when I start to suspect that my DM is tweaking things in my favor behind the scenes while still pretending to run things by the dice. It's also been my experience when DMing as well that players tend to get annoyed if they suspect you're not being straight up with them (though they don't always say anything about it directly.) My experience, though, obviously isn't universal, and there are probably players out there who don't really care what the DM is doing behind the screen as long as the game keeps rolling. But based on that experience, I strongly recommend communicating with your players about what might happen in those kinds of situations, and sticking to that when they do come up in game.
This is the sort of subject I would definitely cover before gaming with a group. Some players are blase about losing a character and merely reach for the dice to roll up a new one, while others treat their characters better than their spouses and might stomp away from the table in disgust if they lost one.
Let your players know your feelings on this (hard and fast, if you're dead, your'e dead; or, more lenient, you have a chance to survive no matter what the dice say) and stick to it. Nothing worse, not even a TPK, than a DM or gamemaster that won't keep his word.
If the danger of the situation has been relayed appropriately (this is the lair of a dragon that has killed 100 adventurers), and your party is relatively powerful and with many resources, you should really let the chips fall where they may. Constantly "letting" players win, ignoring or forgiving dumb mistakes (rushing a demon lord with 1 hp and a dagger), never letting players face foes beyond their capability (would Darth Vader be the villain he was if he was only as powerful as the rest of the Star Wars gang?), or constantly pulling them out of trouble with Deus Ex Machina is really just enabling bad habits of your players, and not letting them experience the full richness of the gaming experience. Some of the greatest flicks of all time (The Seven Samurai, The Magnificent Seven, The Wild Bunch, The Dirty Dozen, Butch Cassidy and the Sundance Kid) end up with either a TPK or something pretty close to it, and yet these are regarded as some of the greatest films ever made. There is something about a "grand gesture" that ends in death that is timeless in culture. Encourage the same feeling in your players should this happen to them, saying their deaths will be extolled by bards and their sad tale told around campfires for decades to come (especially if their end was at the hands of some superior foe like a dragon or demonic being), inspiring new heroes!
If you have a TPK and for some reason you, the players, or both you and the players don't want it to end like that, there are several ways to work around a final ending for the characters:
In a fantasy world, being raised from the dead is not out of the question. Have a high level priest or mage find the dead characters, have them raised, then have the PCs serve their savior for awhile to pay him back. Perhaps he has brought them back for a specific mission he wants them to perform....that could mean their death (again!)...
Whoever has destroyed the party may have an enemy other than the PCs, who would be loathe to see his rival get away unscathed. This being (who may be evil!) arranges to have the characters raised and, behind the scenes, puts them back on the trail of their killer(s) with additional powerful magic items. Imagine the roleplaying possiblities when the party finally realizes they have been raised by a creature just as bad as the one that killed them, and they have been doing his dirty work for him!
After the final body has fallen, the next session have the characters wake up in some desolate locale, alive but confused at how they got there. It could be a tropical isle or a frozen waste, and lots of adventures await them surviving and getting back to their own lands. If they do any investigating of how they could have possibly survived, have them discover (through research or spells) that a non-descript ring worn by one character was actually a special ring of wishes, with one wish, whose power was subconsiously activated when the character died to bring himself and his allies back to life in a "safe" place. This is a good hook if you want to completely change up the campaign feel and perhaps take away some magic or items you didn't like your players having (trade off for having come back to life...maybe they wake up nude in the distant clime with nothing but their mind and body to help them survive!)
If your players are the type that are up for a bit of roleplaying and a real challenge, have them wake up in a dirty cell, having been raised, jailed, and enslaved by their foe! Gloating at them through the bars of their new home, he tells them they will slave away in the mines (mines are always good, being below the earth!) until they die and then he will raise them again and again...what's the point of them dying when he can torture them forever? This can lead to some great roleplaying and ingenuity as the players try to work out their best "Escape from Alcatraz" scenarios attempting to get their items back and get the heck outta there. They aren't dead, but they may wish they were!
A mundane solution is to have the next party consist of family, friends, hirelings, henchmen and employees of the first group, all banded together to find out what really happened to "Party X" who disappeared many years before. There is a connection to the first party, and as an added bonus, if/when they find the remains of their family/friends, they can get all the magical goodies that have lain there for years untouched! Have the original villain come around to challenge the PCs, so they can get in a bit of revenge eventually.
Most of all, whatever you do, make sure you all are having fun and everyone is ok with what is going down. You might be surprised at how many players are ok with a TPK as long as everything was fair and above board.
I'd say there's a few ways to escape from a TPK once you've realised it's happening.
Cheat. Roll some good dice for them, some bad rolls for the monsters, and things work out ok. This is not generally accepted as satisfactory, but its easy.
Use the 'you wake up later', battered and bloody and all your kit is gone, along with the monsters but you're alive - barely. You hobble out and a passing NPC helps you recover. This is obviously a bodge for the players, and they'll know it, but they will get the chance to fight again - possibly going back in for revenge as a subsequent quest. This is more acceptable than #1 and is possibly the best thing to use if they screwed up simply due to some really poor luck. This is also the technique to use for Cthulhu games - once a person faints, they're left alone by the monsters.
Use the 'cavalry' trick. You're in trouble, but it's ok 'cos here comes some good guys who either happen by, were designed to come along, or were destined to and scare or beat the baddies away. The players may feel a little cheated sometimes, depending on the situation, but it can work well sometimes.
Use the 'Balrog is coming' trick. You're in a battle, things aren't going well, overwhelming odds with no chance for you... and then all the monsters look around, say "ohhh shiiiiiit" and run away. Leaving your party the chance to run and/or hide instead of fight. (which is course they manage). I like this one the best as it stops the bad luck proceeding and gives the players a chance to get out of the situation on their own merits. Of course, if they want to stand and fight the balrog, they were obviously too stupid to live in the first place :)
I like to let the dice fall where they may. Some games are heroic journeys and others are tragic tales on the dangerous life of adventurers, cautionary tales that end with corpses in unfinished dungeons.
I say, when a TPK comes up, build on it. Make characters who would go looking for the deceased and see where it leads, allow the players to get some closure and bring their characters' bodies home for burial and see that dungeon finished.
At low levels, with minimum player investment, a TPK is perfectly fine. It simply verifies the risks of adventuring. However, be sure to talk to your group afterward, and alleviate any hard feelings that may have arisen. Point out that they are perfectly welcome to 'restart' the exact same characters (with different names), and the build time isn't wasted.
Such a horrific event, if treated as a normal hazard, will increase the thrills and tension in subsequent games, and especially so in pressure situations.
Once a significant player investment has been made, however, it's far better to find alternatives. Some excellent ones are offered in other answers here. I tend toward the simplest: the characters are knocked out and captured. If your chosen rules system doesn't allow for this, don't worry about it. Then prove that you are trustworthy by rescuing them, via means mundane or deific, possibly losing all their kewl stuff but hey, it's better than dead... Revenge is sweet, and so is stealing back your own stuff and then some (the final turn in such a plot).
You have different factors, phases to consider, and different outcomes.
The main point you always have to consider is the following: if your players know you are never letting a TPK happen, they won't take things seriously.
That said, it is a matter of phases. With low level characters, a TPK must be accepted. Characters are too low-level for anyone caring enough to have them raised. Raising is expensive, and if you are a young adventurer, you most likely have no rich parents that care about you so much to be able to obtain the thousands of gold coins worth of money for a raise. Multiply for the party size, and this is clearly not an option.
If your character are in the high-level phase, it's more likely that someone will take care of them and perform a raise. You can do this, but it will carry some considerable penalties. For example, you can say their bodies were found by the local monastery and their equipment sold. With the obtained money, they are brought back to life, but they will be naked, and in an untold but implicit obligation to perform a favour to the abbot. This can get them back on track in terms of money and equipment.
There are other clever tricks you can use. The "it was just a bad dream" one is the worst, but you can use it if you are very screwed. I loathe it, however. A better approach is to accept the condition and have all the character get a ghost archetype (in D&D) and have them continue the adventure in ghost or revenant form.
Another possibility is that you make them resurrect via the hands of an evil necromancer, and turn all their alignments to evil. This will bring them back to life, but with a bond to the necromancer, so they will have to get along with him somehow.
It depends on the style of game. I would only accept or run with a TPK if you are shooting for that "hardcore" survival-of-the-fittest feel in your game. In most other flavors of game, having all of the characters die isn't fun for the players.
Notes for running combat:
If all else fails:
Generally, I advise to
I've had a few TPK's... the most memorable: the party was facing a bunch of illithids. The cleric dropped his holy symbol, as the party fled. (Due to a fumble.) They waited topside for some time, then the cleric ran to get his holy symbol. (Given that he was the sole cleric of Benekander, and the symbol was in fact given to him by Benekander, he couldn't just go have a new one made.) He ran into the illithids, and slurp. The other players, one or two at a time, knowingly, because it was in character, went in to rescue him... and one at a time, they were slurped up. They felt it the right way to end that campaign. It was a tragic, but appropriate end to a year of excellent long sessions. So, not all TPK's are entirely the GM's fault, and sometimes they are a good thing.
Of course, if you're playing Paranoia, Brute Squad, or other TPK Expected games, none of the above applies. Just ask if they want to play again. Heck, I've had a Paranoia session run to 1000% kill rate. (Yes, I killed 10x as many PC's as I had players. One of the players lasted well into the second set for the other 3 players...)
If the party was killed by stupidity or greed, they probably earned it. Hopefully the players will learn.
If it was bad luck, you have several options:
I have an example I used in a long running campaign I ran a few years ago. It was about two years into the campaign when I had the players run into some minions of Tiamat (this was 3.5). The fight was WAY below their expected CR, and yet I absolutely demolished them (CR being a rant for a different day...)
I did not want to have a TPK, as we were in year .... 3 I think? ... of the campaign, and it ended up going on for at least another year after that (maybe 2? It has been a while...)
So, the reason Tiamat was after them was she wanted an artifact that they held. I ruled that she was unable to scry for the artifact, and so captured them to try and get them to admit where the artifact was.
This led to them destroying the artifact to keep it out of her hands (which, eventually led to the creation of a new god...) and then escaping (with the help of the avatar of this new god they created...)
While off the cuff, I played it off well enough that the whole party thought that this was my entire plan from the get-go, until after the session when we were BSing.
While I would not want to do this every time, as it would cheapen the game, in this case there was a serious discrepancy that I had not accounted for (the CR not being a valid way of evaluating the actual challenge rating of a creature), and I wanted to make sure that the players were not horribly punished because of my screw up. Later down the road, we had a player whose character was killed, and the whole group had to deal with the consequences of that.
Oh, and yes - they did finally get Tiamat back in the campaign - that was the thrilling conclusion to it right before I left town. :)
I also really like the prison-break idea.
Here I can give you a solution. It happened to me a lot of times since as a DM I'm very lucky with dice rolls and usually I exterminate my poor party with triple 20s (Lethal hit).
When they are all dead you can send them an unexpected help like Valkyries from the North Mithology, that are harvesting powerful soul for the incoming Ragnarok. In exchange of serving the God Odin they can be granted a raise, with a lot of XP extra too. It's like a side quest, I suggest to keep in play for at least 5 sessions to make the party feel the new scenario and all. You can warn them that if they are killed in soul form they will be forever lost.
And who knows? Maybe they like it and choose to serve Odin forever :)
This can really be pretty subjective based on the party - there are some parties I've DM'd where, had I let a TPK happen, it would certainly have led to dissolution of the party.
One time, I dealt with this by role-playing some scenes in the afterlife where a party member's deity raised them all, but applied a geas to the party in return, requiring that they pursue some goal set by the deity in question before returning to their own goals.
Have you ever played a video game in which your main character dies, only to allow you to continue the campaign from another point of view with retained meta-knowledge? I can think of a few and my most favorite example is the Call of Duty Modern Warfare series.
Private Jackson dies, and it only took a nuke to eliminate that fine marine! The emotional/time investment given to the protagonist private Jackson during 4 of the levels in first act of the game, and his subsequent semi-glorious death, allowed the first act to end on a note in which the player clearly understand the stakes of the modern warfare. It is not about dodging bullets but acting in a concerted effort to prevent mass-destruction. The hardened marine who could withstand a hurricane of bullets still fell victim to the plots of cornered nationalist deploying weapons of mass destruction.
Consider a TPK as a narrative event, not a mechanical or story failure. Sure it was unplanned and most likely the party did not go out with a bang like private Jackson, but it can still be used to tell the story and advance the plot. It underlines the lethality of the world, the consequences of failure, encourages being more tactical and thoughtful with the next party.
Perhaps the new characters have heard some legends/rumors about the old party and are seeking them out because they have similar goals. This explains to some extent their meta-knowledge, and their conviction to continue the old party's campaign when discovering that the old PC's have failed in their quest. Perhaps the new party will focus more on tactics and combat synergy to continue the campaign, or seek out NPC allies to aid them, but either way the campaign can continue and the TPK can serve as a constructive narrative, rather then an unfortunate event.
You the GM just have to always have a backup plan in case things go south.
Ask your players what they want to do, and let them know that everything is on the table. You may think they can't hack a TPK, but in fact they've been itching to play a new character. Or they may like the idea of being slaves of a Necromancer... and figuring out how to get free and take him out.
If you want to penalize them for the TPK, tell them that too, so you all can come up with a penalty they can live with. To some players and some games, losing your stuff is a fate worse than death.
They might surprise you. Or they might beg you to let them have a "do over", in which case now you know: you're playing with a bunch of complete crybabies. ;-)
