Raid on Midgar

The Raid on Midgar is an event in Final Fantasy VII when the Diamond Weapon attacks Midgar by firing its powerful beams of energy towards the city. Although being able to destroy the Diamond Weapon with the Sister Ray cannon, the Shinra Company couldn't prevent the Weapon from firing at the city, destroying the upper floors of the Shinra Headquarters and presumably killing Rufus Shinra in the process. Combined with the assumed death of Scarlet and Heidegger at the hands of Cloud's party, this event spelled the end of the Shinra Company's position as the dominant power in the world.

Before the Battle
Cloud's party has found out from Bugenhagen that Aeris had cast Holy to stop Sephiroth's Meteor from destroying the Planet. Sephiroth is holding Holy back, and the only way to save the Planet is by destroying Sephiroth himself. As the party is leaving the Forgotten Capital, they pick up a signal and discover Diamond Weapon attacking Midgar. They fly the Highwind to Midgar to confront Diamond Weapon and protect the city.

Shinra has just finished their two new weapons: the Proud Clod and the Sister Ray. Shinra plans to use the Sister Ray to destroy the energy barrier around North Crater.

Battle
Both the Highwind and the Diamond Weapon arrive at the outskirts of Midgar around the same time. Cloud chooses two allies to help him fend off the Weapon. After inflicting minor damage to it, Reeve Tuesti, the Head of Urban Development in Shinra (acting through Cait Sith) orders the party to get away, for the Sister Ray is being launched. Diamond Weapon fires at the city before Sister Ray's energy blast destroys it, along with the energy barrier around the crater. Even after having been destroyed, the Weapon's beams of energy hit the Shinra Headquarters and leave President Rufus Shinra injured and thought dead by both Cloud's party and Rufus's minions alike.

Events following the battle
The party learns that Scarlet and Heidegger are ordering Reeve to turn off the Midgar Mako Reactors, but Reeve is not able to. They discover it is Hojo's doing, and if they don't stop him the reactors will explode, destroying Midgar. Reeve is arrested for his double-agent role. The party parachute to Midgar and can choose to confront the Turks, depending on previous actions, and then defeat Scarlet and Heidegger piloting the Proud Clod.

Once they reach Hojo, he reveals himself as Sephiroth's father and that he is going to fire the Sister Ray to give his son a burst of energy to help him out. The party kills Hojo but because he experimented with his Mako Juice on himself, he is reborn as the monster Helletic Hojo and then Lifeform-Hojo N. Cloud's party deactivates the Mako Reactors before it is too late. Before his demise, Hojo uploaded his consciousness onto the Worldwide Network, as revealed in the sequel Dirge of Cerberus -Final Fantasy VII-.

Aftermath
With Hojo dead, the Shinra descending into chaos, and the elimination of Sephiroth's barrier, the events proved to be a serious setback to both of Cloud's party's enemies. It marks the end of the Shinra Company's influence over Midgar and the Planet; although it is revealed in Final Fantasy VII: Advent Children that Rufus Shinra escaped the Shinra Headquarters' destruction, and seeks to revive the company, the populace has grown suspicious of Shinra and with its main business model, production of Mako Energy, out of the picture, the new Shinra Company can no longer project power of the Planet like they used to.