This paper seeks to explain what is financial crisis, which are it`s manifestations and causes which was leading to the last financial crisis in the United States and it`s spillover in the Euro area. Financial crises are great disorders in the financial system that could have far-reaching consequences in a long-term on the economy as a whole. This paper will highlight the importance of maintaining financial stability in the system and show that the extent of the crisis can take in if prevention of it`s development is not right. It will introduce in and show special system measures of the Federal Reserve to fight the crisis and willevaluate their effectiveness. It will present channels with which the crisis has affected the euro area, and analyze the response and operations of the European Central Bank. The beginnings of the crisis in the euro area date back to 2008. after the disintegration of the American system of mortgage loans based on non-performing loans. Sophisticated financial instruments and their derivatives through the global banking system have affected the Euro area. Paper will analyze Greece, Ireland and Cyprus, part of eurozone countries which have found themselves most affected by the crisis. Finally, to fully understand the financial crisis in the Eurozone, it is necessary to relate debt, banking and economic crisis and to bring out conclusion.