Owing to disputes as part of the FISA-FOCA war, the race went ahead without the manufacturer teams of Ferrari, Alfa Romeo and Renault, because the Fédération Internationale du Sport Automobile (FISA), then the governing body of Formula One, had declared the race illegal. The other teams drove the race, now sanctioned by the Formula One Constructors Association (FOCA). All teams competing in the race ran Ford engines.
Carlos Reutemann, Nelson Piquet and Didier Pironi all retired from the race whilst in the lead, Reutemann due to a collision and Pironi and Piquet because of mechanical problems. Only six of the twenty-two drivers who took the start of the race made it to the end, and only three were on the lead lap.
The Spanish Grand Prix was originally scheduled to be the seventh round of the 1980 World Championships. Coming into the race, Brabham driver Nelson Piquet led the World Championship of Drivers, one point ahead of Renault's René Arnoux. Williams driver Alan Jones was third, a further two points behind and Ligier driver Didier Pironi was fourth, two points behind Jones. The Constructors' Championship was led by Williams with 34 points, with second place Ligier five points behind. Brabham were third with 22 points and Renault fourth with 21 points.
In the previous rounds of the championships, there had been disputes between motorsports' governing body, the FISA, and the body representing the independent constructors competing in the championship, the FOCA. 12 of the 15 constructors competing in the championship were members of FOCA. The three constructors that were not affiliated to FOCA, Renault, Ferrari and Alfa Romeo, were all owned and operated by a manufacturer. The FOCA teams perceived FISA as showing a bias towards the manufacturer teams through the regulations by which the sport was governed, and were unhappy at the way FISA handled commercial aspects of the sport, including the distribution of revenue to the competing teams.
As part of the dispute, drivers from FOCA affiliated teams had been advised to boycott the driver briefings at the Belgium and Monaco Grands Prix, the preceding rounds of the championship. The compulsory 45-minute briefings had been announced by FISA president Jean-Marie Balestre in February, but FOCA's lawyers had noticed that the requirement for drivers to attend had not been included in the rulebook. Nevertheless, FISA issued fines of approximately $2000 to the drivers that did not attend them at Belgium and Monaco, and after non-payment had threatened suspension of the involved drivers' racing licences. By May 29, prior to the first official practice for the race, FISA had ordered the suspension of the racing licences of fifteen drivers.