Microtubule (MT) dynamic instability is fundamental to many cell functions, but its mechanism remains poorly understood, in part because it is difficult to gain information about the dimer-scale events at the MT tip. To address this issue, we used a dimer-scale computational model of MT assembly that is consistent with tubulin structure and biochemistry, displays dynamic instability, and covers experimentally relevant spans of time. It allows us to correlate macroscopic behaviors (dynamic instability parameters) with microscopic structures (tip conformations) and examine protofilament structure as the tip spontaneously progresses through both catastrophe and rescue. The model's behavior suggests that several commonly held assumptions about MT dynamics should be reconsidered. Moreover, it predicts that short, interprotofilament "cracks" (laterally unbonded regions between protofilaments) exist even at the tips of growing MTs and that rapid fluctuations in the depths of these cracks influence both catastrophe and rescue. We conclude that experimentally observed microtubule behavior can best be explained by a "stochastic cap" model in which tubulin subunits hydrolyze GTP according to a first-order reaction after they are incorporated into the lattice; catastrophe and rescue result from stochastic fluctuations in the size, shape, and extent of lateral bonding of the cap.