On June 11, 1994, at 0831 hours Pacific daylight time, a McCulloch Aircraft Corporation J-2 gyrocopter, N22GR, collided with terrain after takeoff from the Willits Municipal Airport, Willits, California. The gyrocopter was being operated as a personal flight by the pilot/owner. The gyrocopter was destroyed and the certificated commercial pilot received fatal injuries. The flight departed the Willits Municipal Airport about 0830 hours. Visual meteorological conditions prevailed for the local flight. The gyrocopter had just departed the airport at the time of the accident. A ground witness heard the aircraft depart and then heard the engine quit. The gyrocopter struck the terrain about 1/2 mile south of the airport and caught fire. The pilot stated to this person during the rescue that he "could not get the rotor blade up." The engine was examined on June 15, 1994, at Ukiah, California, under the supervision of an inspector from the Federal Aviation Administration (FAA). He reported that the No. 3 cylinder head had a crack approximately 3 inches in length. There were no exhaust or oil stains found in the cracked area to indicate problems prior to impact. The inspector noted nothing during the inspection of the engine that could have contributed to the power loss. The FAA inspector's report, and that of a local mechanic, is attached.