The definition of tragedy that I learned (in the Greek Tragedy, literary sense) is a punishment or outcome whose gravity greatly exceeds the offending action.

Example 1:
In Sophocles' trio of tragedies including Oedipus the King, Oedipus at Colonus and Antigone, Oedipus unknowingly kills his father and marries his mother, as was prophesised when he was a baby. When Oedipus learns of his sin, he gouges his eyes out and lives like a hermit, traveling and blind from town to town, moving on to the next when the people learn who he is and drives him out. His sin was hubris. He did not stop when he was warned to stop by countless people, as well as the chorus. He lived 20 years, homeless and blind, even though he had no way of knowing who the man was, that he killed.

Example 2:
In Marlowe's Doctor Faustus, Faustus wrestles with his mission in life, and what he wants to do for a living. He turns down medicine, as he can only prolong the inevitable. He turns down theology and the church because if all men are sinners, no matter what, what good does it do to worship and work to that end when he must fail in the end? Lastly, Faustus wrestles with science, but this too is faulty in his eye, because there is only a finite amount of information to learn in the world. So Faustus turns to alchemy and signs a contract with Mephistopheles, one of the devil's "henchmen", for lack of a better word. In the end, Faustus is told that to be released from his 20 year contract and go to heaven eternally in stead of hell, he just must ask God for forgiveness; however, Faustus can not understand nor accept how anyone, let alone God could forgive a man such as he who turned his back on him previously, so in the end, Faustus is dragged to Hell for all time, because he could not humble himself and ask forgiveness of a greater being.