Jockey Edgar Prado said he heard "a crack" as the horses turned for home.
"It happened so quickly," Prado said. "I don't know if he stepped in a hole or what. I tried to pull him up but he was in a full run. It's hard to explain. It happened so fast."
Landseer, a son of Danehill, had made his move from six back when the fracture occurred.
"Landseer suffered a severe, what we call a severe comminuted multiple fracture to the canon bone on his right front (leg) just below the knee," Dr. Wayne McIlwraith said. "The fracture was open ... and it required euthanasia."
It could have been worse. Rock of Gibraltar "just ran into the back of Landseer," trainer Aiden O'Brien said. "It stopped him." O'Brien also trained Landseer.
Landseer, whose last outing was a win in the Shadwell Turf Mile at Keeneland, had lifetime earnings just shy of $1 million.
The 19th running of the Breeders' Cup Championship took off under gray skies at Arlington Park.
What is arguably the nation's premier track was decked out in purple and yellow chrysanthemums for its debut as a host for the eight-race series that is a deciding factor in Horse of the Year and other honors.
The track hosted 46,118 fans Saturday, most of them in temporary stands erected specifically for the event.
A few rays of sunshine broke through the clouds just before the final Championship race.
Chicagoan Philip Johnson said winning a Breeders' Cup race in his hometown meant a lot to him.
Johnson's Volponi pulled off the upset of the day in the $4 million Classic and Johnson said the Cryptoclearance colt was just living up to his name.
"I named him after a newspaperman. Someone told me I won the Volponi award. It's Italian. It means 'sly old fox,'" Johnson said.
Johnson said it wasn't hard to decide in which race to enter Volponi.
"I think he's a natural mile-and-a-quarter horse. He runs as well on the turf as he does on the dirt. The Mile (run on the turf course) is $1 million. The Classic is $4 million. You do the math," Johnson said.
The rest of the card:
Gold Mover won the $100,000 "Right Here Right Now" Safely Kept Handicap to kick off the day. The ¾-length victory over Oglala Sue, with Victory at Sea in third, earned the winner a 30-day rest before she heads to Florida to prepare for next year, trainer Mark Hennig said. Gold Mover paid $3.60, $2.60 and $2.10; Oglala Sue, $5.20 and $3.40, and Victory at Sea, $3.60.
Hero's Tribute socred a 2-length victory over Balto Star in the $100,000 Black Tie Affair Handicap. Hero's Tribute paid $6.20, $3.60 and $2.60; Balto Star paid $3.20 and $2.80, and Silver Zipper paid $2.80.
And in the final race of the day, Capsized won the $100,000 Steinlen Handicap. One More Round was ½-length back in second and Al's Dearly Bred was another 2 ¼ back in third. Capsized paid $5, $3.40 and $2.60; One More Round, $5.60 and $3.80, and Al's Dearly Bred, $3.40.