A Fatal Counter is a type of Counter Hit introduced in BlazBlue: Continuum Shift that is even more devastating than a normal Counter hit. This is because when the opponent is hit by a Fatal Counter, all attacks that follow up in that combo will have a slightly longer stun effect than usual. Like Counter Hits, Fatal Counter Hits allow to perform advanced combos that are only possible after a Counter. Each character has one or two attacks that can cause a Fatal Counter Hit.
For example, Ragna's crouching C causes a Fatal Counter Hit when he counters with it and can be followed up with his standing D > Dash Cancel multiple times, something that could not be done without a Fatal Counter Hit.
Fatal Counter combos have the potential to be far more powerful than combos performed without one, due to more chances to rack up damage with longer combos.
Some moves can also Fatal Counter without a counter hit needed, such as Rachel's midair 2C. However, in this regard, Fatal Counters cannot stack in the same combo.