Lake Placid, like St. Moritz and Innsbruck before it, was given a second chance to host the Olympic Winter Games. With no other city wishing to bid, in the light of the problems experienced from 1968-76 by the Winter Olympic host cities, only Lake Placid remained as a candidate when it came time for the IOC to award the 1980 Olympic Winter Games. In the era of spiraling costs, Lake Placid promised a simpler Olympics, a "kindler, gentler Games", though years before President George Bush. But the complexity of television, and millions of spectators almost proved too much for the small upstate New York village. Transportation and communication was difficult and the IOC vowed never to return the Games to such a small venue. The Lake Placid site was also plagued before the Olympics by complaints from environmentalists. But the Lake Placid OCOG worked with the environmentalists, really heralding a new era of "green Games" for the Olympics.

Politically, the IOC again had problems with the "Two China" issue. In 1979, the IOC had recognized the People's Republic of China, based on the mainland in Beijing. The ruling stated that the island nation of China on Taiwan would henceforth have to compete at the Olympics under the name Chinese Taipei, and using a new flag and anthem. But Taiwan arrived at Lake Placid with the same flag, the same anthem, and uniforms that had Republic of China on them. The IOC refused to allow the nation to compete under that name, and Taiwan withdrew from the 1980 Olympic Winter Games in protest. As if those were not enough problems, shortly before the 1980 Winter Olympics, the Soviet Union invaded Afghanistan in December 1979. President Jimmy Carter promptly called for a U.S.-led boycott of the Moscow Olympics. And he used Secretary of State Cyrus Vance to make this announcement to the IOC at their session in Lake Placid days before the Games started. The IOC was outraged at this blatantly political statement, when Vance's task was simply to welcome the IOC to the United States.
But Lake Placid had two great redeeming features. Their initials were [Eric Heiden] and the U.S. ice hockey team. In speed skating, Heiden was the greatest skater in the world and pre-Games predictions had him winning five gold medals, though few believed he would actually win all five. But he did. He ended his Olympic dominance with a gold medal in the [10,000 metres]. Racing in the second pair with [Viktor Lyoskin] (URS), Heiden had to beat the time of [Tom Erik Oxholm] (SWE). Lyoskin set an intimidating pace, which met with little success as Heiden ground Lyoskin down in the second half of the race, skating monotonously similar laps, and when Heiden's 10K, and his Olympics, was over, he had a world record by six seconds and his fifth gold medal.
In ice hockey, the Soviet Union was by now conceded the gold medal at all Olympics. Their teams were the equal of anything the National Hockey League had to offer. A week before the Olympics, the U.S. and the U.S.S.R. played an exhibition game in Madison Square Garden and the Soviets won, 10-3. But the U.S. team had more fortitude than anyone suspected and were led by a coach, Herb Brooks, who brought more out of them than they knew they had. In an early match against Czechoslovakia, Brooks shocked an American television audience. The Americans were close to victory at the end of the game when a Czech put a vicious, borderline dirty, check on U.S. star [Mark Johnson]. With the camera focusing on him, Brooks then told the Czech exactly what part of his anatomy would receive that stick if he tried it again. The Americans could not, and would not, be intimidated.
In the semi-finals they faced the Soviets. The score was tied in the 3rd period when captain [Mike Eruzione] scored to put the U.S. ahead, 4-3. As time ran out with that same score, Al Michaels, ABC television announcer, echoed everybody's thoughts when he asked, )Do you believe in miracles?) Two nights later, the Americans defeated Finland to win the gold medal, and every American believed. Taken from http://www.sports-reference.com/olympics/winter/1980/

In late December 1979, Soviet tanks invaded Afghanistan. On 26 July 1980, [Volker Beck] (GDR) won a gold medal in the 400 metre hurdles at the Moscow Olympics. Unrelated events? Hardly.

After the Soviet invasion of Afghanistan, United States' President Jimmy Carter called for a boycott of the Moscow Olympics if the Soviets did not withdraw before 20 February 1980. They did not. Carter pressed his efforts, attempting to enlist other countries to join his boycott. But American allies Britain, Finland, France, Ireland, Italy, New Zealand, Spain, and Sweden all competed at Moscow. Carter made his announcement public to the IOC via Secretary of State Cyrus Vance, who rather rudely addressed the IOC at the [Lake Placid Games] in February. Many U.S. athletes protested Carter's idea, but Carter was adamant, threatening to withdraw U.S. passports, and putting political pressure on many American businesses that supported the U.S. Olympic Committee. The United States government, which has never officially helped the U.S. Olympic Movement in any way, but enjoys basking in its limelight every four years when it is politically expedient, thus stopped U.S. Olympic participation for the only time ever.
Approximately 63 countries eventually boycotted the Moscow Olympics – it is actually difficult to be precise because some nations stated that they would not compete, but that they were not boycotting (See the lists below). Notable among these were the United States, Canada, West Germany, Japan, China, Kenya, and Norway. Several countries that did not boycott protested at the Olympic ceremonies. Ten countries elected not to march at the [opening ceremonies], while six other nations marched behind flags of their national Olympic committees, or the Olympic flag, rather than their national flag. Several countries chose not to have their national anthems played at victory ceremonies, substituting instead the Olympic hymn. Finally, at the closing ceremony President Carter refused to allow the American flag to be raised as the host country of the next Olympics. The flag of Los Angeles was raised instead.
The Moscow Games were scheduled to be televised by NBC (National Broadcasting Company). Once the boycott took effect, NBC withdrew its cameras and its money, showing only short clips and daily summaries of the events. The loss of the American television money would have been a crippling blow for most Organizing Committees, but it had little effect on the Moscow committee as it was completely state-supported.
The Games suffered in level of competition but they were marvelously run, although spectators spoke often of the military atmosphere as Soviet soldiers were on every street corner with automatic weapons. The most awaited races matched two Brits in the [800] and [1,500 metres] in the track and the boycott had no effect on them. [Sebastian Coe] was favored in the 800 and [Steve Ovett] in the 1,500. They each won a gold medal, but in the )other man's) event.
The absolute prohibitive favorite in the [men's 400 metre hurdles] on the track would have been [Edwin Moses] of the United States. In his absence, Volker Beck won what may constitute the most de-valued gold medal in Olympic history. Beck's time was one that Moses would have only posted in an early round heat, while warming up for the final to come.
In 1980, President Carter was defeated in his re-election bid. Nine years later, in mid-1989, Soviet troops finally left Afghanistan. The Olympic Movement was on the ropes, now staggering from the haymaker punches of Munich, Montréal, and Moscow. Taken from http://www.sports-reference.com/olympics/summer/1980/