Walter Donovan was a wealthy American industrialist and collector of antiquities who allied himself with the Nazis in order to get the Holy Grail, which he sought for its fabled gift of immortality.
He hired Henry Jones, Sr. to track down the location of the Grail and paired him with Dr. Elsa Schneider to find the location of a grail knight'stomb in Venice. When the senior Jones realized Schneider's Nazi affiliation, he was made to conveniently 'disappear'.
Donovan used the disappearance of Jones to lure the man's archaeologist son Indiana into helping him find the vital clues leading to the location of the Grail. After Indy detoured to rescue his father at Castle Brunwald, Donovan revealed himself as a Nazi ally. When reports of Marcus Brody's apprehension by Nazi agents in Iskenderun were given, Donovan traveled with Schneider to Hatay to find the Grail.
With Dr. Schneider, Donovan arrived at the Grail Temple and proceeded to send soldiers into the temple's traps. When Jones and his allies arrived, they were captured and Donovan forced Indy to figure out how to get through the set of booby traps by shooting Henry. After Indy reached the inner sanctum where the last of the Grail knights kept watch over the sacred chalice - and several more false chalices - Donovan and Schneider followed in safety.
Upon seeing the visitors looking at the grails, the knight guardian explained that only by drinking from the true Holy Grail would grant a person eternal life, while drinking from a false Grail would forfeit their life. Faced with this dilemma, Donovan surveyed the potential Grails. Dr. Schneider volunteered to pick one for him. She gave Donovan a golden grail, with gemstones implanted on its sides. Donovan drank from that Grail, and to his horror found himself aging rapidly and eventually decomposing. Recognizing that he had been tricked, he tried to attack Schneider, but Indiana Jones kicked the near-skeletal form of the doomed Donovan against a wall where it shattered into dust.
The effect of Donovan's rapid aging and explosion into ash was dubbed "Donovan's Destruction" by the ILM staff and marked a technological breakthrough in effects work as the first shot completely computer composited and then scanned to film. ILM used life-size articulated puppets of Donovan's head in different phases of decomposition. Images were scanned into a computer where they were processed to form a seamless transformation.[3]
Donovan is the final boss in the game Indiana Jones' Greatest Adventures. Rather than perish upon drinking from the false Grail (which in that game he seemingly independently chooses, as Elsa Schneider is never shown or mentioned as choosing it for him), Donovan turns into an undead monster which the player must defeat.
In the non-canon game LEGO Indiana Jones: The Original Adventures, Donovan independently chooses the wrong Grail; he is shown eagerly running to that grail and just immediately drinks from it. Indy never kicks him into a wall, either: Donovan simply ages to death in a somewhat comical manner. Donovan can be unlocked as a playable character in three versions: his tuxedo, his blue-gray suit and of course his undead form (DS version only, although buildable as a custom character in other versions).
In the sequel, Donovan is super-powered by a whirlwind, which can only be destroyed through use of a bazooka and silver objects.
In the LucasArts graphic adventure game adaptation, Donovan gets his head chopped off instead. However, Indy will suffer Donovan's original fate if he drinks from the wrong Grail.