At five (peacetime) and four (alert), each country gets to place their silos, airbases, radar dishes and fleets, but no hostilities are allowed. At three (war), fleets and aircraft can fight each other, but no nukes can be launched until DEFCON 1 ("World War Three," as WarGames put it).
At that point, yellow radiation icons blossom all over the map and the words "Launch Detected" materialize over international waters. The escalating hostilities unfold at the rate of player choice: you can switch between real-time for the key moments and up to 5x normal speed when you're waiting for an enemy move.
Nukes are the only way to inflict civilian casualties, and there are only three ways to deliver them to the enemy: silos launching inter-continental ballistic missiles from your own territory, stealth subs surfacing near enemy shores and sending medium-range nukes inland, and long-range bombers dropping short-range warheads while flying over hostile territory.
Whenever your nukes are even close to an enemy nation, they can be shot down by any silos that aren't currently busy launching nukes. Watching the tiny dashes that represent anti-ballistic missiles spiral round your vulnerable warheads is agonizingly tense, and when one plucky plutonium payload makes it through the defensive hail, the satisfaction is no less than divine.