The Olympic Games were suppressed, either by Theodosius I in AD 393 or his grandson Theodosius II in AD 435, as part of the campaign to impose Christianity as a state religion. The site of Olympia remained until an earthquake destroyed it in the sixth century AD.
Huge resources were spent on holding the games by the Greek rulers. The games were a gift to the common people. Hence, the fans did not have to pay to watch the games. Once the Christians took over the city of Greece, they decided to use the resources to bulid places of worship and spread Christianity. Christians did not view fighting as a Christian ideology.
From : http://answers.yahoo.com/question/index?qid=20090429011705AAIiONk
The Ancient Olympic Games (Greek: Ολυμπιακοί Αγώνες; Olympiakoi Agones) were a series of athletic competitions held for representatives of various city-states of Ancient Greece. Records indicate that they began in 776 BC in Olympia, Greece. They were celebrated until 393 AD. The Games were usually held every four years, or olympiad, as the unit of time came to be known. During a celebration of the Games, an Olympic Truce was enacted to enable athletes to travel from their countries to Olympia in safety. The prizes for the victors were laurel wreaths, palm branches, woolen ribbons and sometimes even food for life. The ancient Olympics were rather different from the modern Games. There were fewer events, and only free men who spoke Greek could compete, instead of athletes from any country. Also, the Games were always held at Olympia instead of moving around to different places every time.
adapted from
http://en.wikipedia.org/wiki/Ancient_Olympic_Games