Short answer
Uthman ibn Affan was killed in his home in Madinah in Dhul Hijjah 35 AH (656 CE) by rebels who had besieged him. He refused to let the Companions fight for him so no Muslim blood would be shed. The Prophet ﷺ had foretold that he would face a trial and gave him glad tidings of Paradise.
Sunni Muslims hold that Uthman was the rightful third caliph and died a martyr, wrongly killed. The rebels came from Egypt, Kufa and Basra; the senior Companions did not take part and condemned the killing.
The four schools agree on this.
Explanation
In the later years of Uthman's caliphate, complaints against some of his governors were spread and inflated, and rebels from Egypt, Kufa and Basra came to Madinah. They surrounded his house for weeks and demanded that he step down. Uthman refused to give up the caliphate, and he also refused to let Companions such as Ali's sons and Abdullah ibn al-Zubayr fight to defend him. He did not want blood spilled in Madinah on his account.
The Prophet ﷺ had told him that Allah might clothe him in a garment, and if people wanted him to take it off, he should not. Uthman understood this as the caliphate. He also gave Uthman glad tidings of Paradise along with a trial that would befall him.
Rebels broke in and killed him, according to the well-known reports while he was reading the Quran, in Dhul Hijjah 35 AH. He was over eighty. His wife Na'ila was injured trying to protect him. He was buried in al-Baqi.
His death opened the period of fitnah (civil strife) among the Muslims. Sunni scholars teach that we speak of all the Companions with respect, believe Uthman was wronged, and keep quiet about the disputes that followed rather than take sides with harsh words. Read his life on Uthman ibn Affan and the meaning of fitnah.
The evidence
Jami' at-Tirmidhi 3705
Grading to be checked... إنه لعل الله يقمصك قميصا ...
"Perhaps Allah will clothe you with a shirt."
His advice to Uthman not to give up the caliphate to rebels; graded sahih.
Sahih al-Bukhari 3695
Sahih... وبشره بالجنة على بلوى تصيبه ...
"And give him glad tidings of Paradise with a trial that will befall him."
The trial of Uthman was foretold.
Where the ruling is recorded
- al-Bidaya wa al-Nihaya (Ibn Kathir), Events of the year 35 AH, the killing of Uthman. The siege, his refusal to fight and the date.
- al-Isaba fi Tamyiz al-Sahaba (Ibn Hajar), Entry on Uthman ibn Affan. His age and burial.
- al-Aqida al-Tahawiyya, Section on the Companions. Sunni creed on loving all the Companions and speaking of them only with good.
This answer is pending review by the scholars on our team. Quran translation by Sahih International. Hadith Arabic from the standard editions of the six books and the Muwatta, with gradings as recorded there; the English is our own rendering. Spotted a mistake? Tell us.