The 334-point drop came a day after the Dow had its biggest gain of the year.
The Dow hasn't had this many big swings since August of 2011, when the U.S. government lost its AAA credit rating.
Energy stocks led the slide as the price of oil continued to slump. Oil fell 2 per cent on worries that the global economy will slow even as production remains high. Chevron fell 3 per cent.
At the closing bell the Dow was down nearly 2 per cent at 16,659.
The Standard and Poor's 500 fell 40 points, or 2.1 per cent, to 1,928. The Nasdaq composite fell 90 points, or 2 per cent, to 4,378.