Having been flawless all weekend, he crashed heavily into the wall midway through his run, knocking him completely off medal pace and leaving a disbelieving Gleirscher jumping for joy in the leaders' booth. Gleirscher's win was Austria's first in men's luge in 50 years.
David Gleirscher of Austria, who passed Mazdzer on his final run, took gold, and Johannes Ludwig of Germany took bronze.
The surprise stemmed from a subpar performance this past World Cup season, which saw a top finish of sixth place.
Mazdzer put together two phenomenal runs to climb from fourth to third in runs 3 and 4 to win the silver medal in men's singles luge - the first men's singles luge medal in US history.
The 29-year-old athlete won the silver medal for his excellent placement in the event earlier in the day on Sunday (February 11) in PyeongChang, South Korea.
And that wasn't the only upset at Olympic Sliding Centre.
Mazdzer took advantage of Russian Roman Repilov faltering in Run 3 to move into second place, and maintained the momentum in the last run.
Mazdzer's camp, consisting of parents, two sisters, his girlfriend and two buddies, duly went ballistic at the finish-line terrace.
But, Germany's Felix Loch who looked like he was on his way to his third consecutive Olympic gold, faltered on the final run and finished 5th.
"One very bad run but that's sport", said Loch, who was consoled by IOC President and luge fan Thomas Bach at the venue.
"It's 16 years in the making", Mazdzer told NBC's Lewis Johnson after winning silver. In the end, it left Gleirscher and Mazdzer shocked, but thrilled.
"It's just magic. I can't describe this, it's just unbelievable".