Avatar: The Last Airbender had plenty of dark and upsetting moments, bu the animated Nickelodeon series had to stop short of explicitly killing off Jet, the leader of the Freedom Fighters, in season 2. Jet's death was later confirmed in the extras for the DVD release of Avatar: The Last Airbender, and when the Freedom Fighters returned in the sequel comic "The Promise," it was without their former leader.
Jet made his first appearance in Avatar: The Last Airbender season 1. After witnessing the deaths of his parents at the hands of Fire Nation soldiers when he was very young, Jet had developed a fierce hatred of the Fire Nation. Though he first seemed like a heroic rebel (whom Katara quickly developed a crush on), it became clear that Jet's grudge against the Fire Nation had corrupted him. He ordered the Freedom Fighters to blow up a dam that would flood a nearby village, drowning not only Fire Nation soldiers but Earth Kingdom civilians as well. Team Avatar was able to evacuate the village, and they parted ways with Jet and the Freedom Fighters on bad terms.
In Avatar: The Last Airbender season 2, Jet returned and was given a redemption arc that ended in his famously ambiguous death. Long Feng, the villainous leader of Ba Sing Se's elite police force the Dai Li, used mind control to force Jet to fight Aang. Jet was able to break free of the mind control when Aang reminded him of the Freedom Fighters, but when he turned to fight Long Feng instead, the earthbender hit Jet with a pillar of rock. The first indication that Jet's injuries would be fatal came in Long Feng's parting words: "Foolish boy. You have chosen your own demise."
In the world of Avatar: The Last Airbender, combatants are frequently hit with rocks, water, ice and fireballs without sustaining any visible injuries. Because of this, viewers had no reason initially to believe that Jet would be killed by the pillar of rock (the impact is not shown on screen, only the aftermath). However, when Katara uses her waterbending in an attempt to heal Jet, she observes worriedly that his condition is "not good." The Freedom Fighters tell Team Avatar to leave before more Dai Li arrive, and Jet assures Katara that he'll be alright. But Toph, who counts seismic lie-detecting among her many powers, sadly tells Sokka, "He's lying."
That was as far as Avatar: The Last Airbender went in terms of confirming Jet's death in the episode itself. In a DVD commentary for the season 3 episode "The Ember Island Players," creators Michael Dante DiMartino and Bryan Konietzo explained that Nickelodeon wouldn't allow them to clearly depict his death, since the show's target audience was children and Jet was still a child himself. Though the show had references to the deaths of characters in the past - like Katara and Sokka's mother, and Uncle Iroh's son - Jet's ambiguous demise is as close as Avatar ever came to killing off a character in the main story.
Once the mourning period was over, Avatar: The Last Airbender actually poked fun at the scene in "The Ember Island Players." In this episode, Team Avatar attend a play that presents a dramatic reenactment of their adventures. After Jet's "death" scene in the play, Zuko (who was not present during the real Jet's final moments) is very confused, asking, "Did Jet just... die?" Sokka replies, "You know what, it was really unclear."
Though Jet's death was indeed left unclear in the episodes that aired on Nickelodeon, he is unfortunately dead in canon. An Avatar Extra factoid available on the Avatar: The Last Airbender DVDs makes the note, "For the record: Jet is dead." Smellerbee, Longshot, Sneers and the other Freedom Fighters returned without Jet in the three-part comic "The Promise." A note from writer Gene Luen Yang in the annotated version of the story says that an early draft of the comic actually included Jet, because he thought the death was ambiguous enough that he could be brought back. However, ultimately Jet's death was left final. As Yang explains, "The world of Avatar is not the Marvel universe. Here, dead means dead."