The Affray at Stark Industries was a confrontation between Tony Stark (wearing his Iron Man Mark III armor) and Obadiah Stane (wearing the Iron Monger armor) at the headquarters of Stark Industries in New York City.
Stane obtained the schematics for the Iron Monger armor from a terrorist organization known as the Ten Rings, who had in turn reverse engineered the designs from an improvised suit of armor built by Tony Stark, whom they had abducted on orders from Stane.
After Stark's return to the United States and his public announcement that Stark Industries would no longer develop weapons, Stane ordered the secret production of the Iron Monger suit, and stole the miniaturized Arc Reactor from Stark's chestpiece to power it. Stark nearly died as a result, but managed to reattach his original Arc Reactor and use it to power his latest suit.
When Stark's assistant Pepper Potts discovered evidence of Stane's illegal activities, she led S.H.I.E.L.D. agents, including Phil Coulson, to Stak Industries. Stane suited up in his Iron Monger armor and killed most of Coulson's team before preparing to kill Potts, but Stark arrived and tackled Stane.
The fight quickly spilled out onto a busy freeway, where Stane used passing cars and motorcycles as weapons to pummel Stark before firing a shoulder-mounted missile. Stark survived the explosion, launching himself into the atmosphere with Stane in pursuit; Stane caught up to Stark just as the Iron Monger suit suffered catastrophic icing, plummeting back down to Earth as Stark's weakened suit dropped to emergency power.
Stark crash-landed, but was attacked again by Stane, who had survived the fall; Stane attempted to crush Stark's suit, but Stark deployed flares that forced Stane to release him. Stark then contacted Potts and instructed her to "overload the Reactor and blast the roof," then attacked Stane and tore pieces of his Iron Monger suit in order to give Potts time to sabotage the Arc Reactor.
Stane managed to overpower Stark and nearly kill him, but Potts activated the Arc Reactor's override switch, sending up a massive stream of energy that disabled Stane's suit. Stane fell from the roof and collapsed into the Reactor's core, setting off a tremendous explosion that destroyed the building.
Following his battle with Stane, Tony Stark publicly announced that he was, in fact, the Iron Man. He was later approached at his home by S.H.I.E.L.D. Director Nick Fury, who indicated that Stark was not "the only superhero in the world" and that he had become "part of a bigger universe"; Fury then explained that he wished to speak with Stark about the "Avenger Initiative."