The pilots were competing in a multi-day, cross-country balloon race. The pilot-in-command stated that they were in a planned descent when they heard gunfire on the ground and ahead of their hydrogen balloon. When interviewed, the pilot-in-command stated that that he never heard any bullets passing by or impacting the balloon, nor did he observe any tracer rounds associated with the gunfire. The flight crew decided to continue the descent and land due to their concerns of flying the balloon at night, at a low altitude, with gunfire activity at the surface. As the balloon descended toward a lighted power substation, the flight crew attempted to jettison ballast to slow the balloon’s decent and clear power lines; however, about 50-100 ft above the ground, the pilot-in-command determined that the balloon would not clear the power lines and he fully opened the balloon’s gas vent to rapidly release the hydrogen and descend rapidly to the surface. The balloon’s basket impacted the ground before the envelope blew into the power lines creating a spark and an explosion of the remaining hydrogen gas. The balloon was destroyed during the hydrogen explosion and postaccident ground fire. Both flight crew members sustained serious injuries during the ground impact, explosion, and ground fire. The pilot stated that there were no preimpact mechanical malfunctions or failures that would have precluded normal operation.