The Argentine Grand Prix had featured on the World Championship calendar since 1953, always using the Buenos Aires circuit. After a lengthy absence the race returned in 1995, and the 1998 edition was the fourth in that revival sequence. The event was the third round of the 1998 FIA Formula One World Championship, contested across 72 laps of the 4.259 km circuit — a total race distance of 306.449 km. Weather on race day was cloudy with variable dryness and temperatures reaching approximately 19 °C.
David Coulthard secured pole position for McLaren-Mercedes with a lap of 1:25.852, 0.399 seconds ahead of Schumacher and with Mika Häkkinen third. The two Sauber drivers, Jean Alesi and Johnny Herbert, collided en route to the grid before racing had even begun.
Häkkinen made the superior start and beat Schumacher into the first corner, allowing Coulthard to retain the lead from pole. Schumacher passed Häkkinen on the second lap. On the same lap Eddie Irvine moved past Heinz-Harald Frentzen. By lap four Schumacher had caught the leading McLaren, and on lap five Coulthard took a wrong line; the two cars touched and the McLaren slid off the circuit, rejoining in sixth place.
The race then became a strategic contest between Schumacher, stopping twice, and Häkkinen on a one-stop plan. Häkkinen's single stop dropped him into traffic behind Frentzen, costing enough time for Schumacher to emerge in front after his own second pit visit. Schumacher crossed the line in 1:48:36.175. Häkkinen finished second 22.898 seconds back, with Irvine third in the other Ferrari at 57.745 seconds. Alexander Wurz claimed fourth for Benetton-Playlife and set the race's fastest lap — 1:28.179 on lap 39. Jean Alesi was fifth for Sauber-Petronas and Coulthard recovered to sixth.
Coulthard's recovery was complicated by gearbox problems and a collision with Jacques Villeneuve, which put the Williams driver out of the race on lap 52. Ralf Schumacher retired from fifth at lap 22 with a suspension failure; Mika Salo retired from 17th on lap 18 with a gearbox problem.
A notable pit lane moment involved local driver Esteban Tuero: when the Minardi driver came in for service, one of his tyres was discovered missing from the car — eventually located back in the garage. Tuero subsequently spun off and retired on lap 63. Schumacher himself was forced briefly off the road near the flag when a late drizzle shower fell, cutting across the grass before rejoining to complete his victory.
After three rounds Häkkinen led the Drivers' Championship with 26 points, ahead of Coulthard on 13 and Schumacher on 14. McLaren-Mercedes led the Constructors' standings 39 to 21 over Ferrari. The result demonstrated Ferrari and Schumacher's ability to compete strategically with McLaren even from second on the grid, a pattern that characterised much of the 1998 season.
The Argentine Grand Prix was not renewed for the 1999 calendar. No further Formula One race has been held in Argentina, making the 1998 edition the twentieth and final Argentine Grand Prix at the Buenos Aires circuit in the World Championship era. The circuit hosted F1 across three separate periods: 1953–1960, 1972–1981, and 1995–1998. Juan Manuel Fangio remains the most successful driver in the race's history with four wins.