This article from The Guardian discusses the real-life grisly murder case that inspired Dickens to write Nancy's fictitious grisly murder in Oliver Twist.
The murder victim was one poetically named Eliza Grimwood, whose murder is described thusly:
"The evidence is compelling that Dickens had Grimwood in mind. Eliza, like Nancy, was half-dressed in bed, and both were forced to their knees by their killers. Eliza's murder was horrible in a different way - her throat was slashed before the killer stabbed her in the womb and breast areas and then attempted to chop her head off.
In both cases the killer brutalised the corpse. In both cases there is evidence to suggest the victim knew her killer. Neither screamed for help. In both cases the bloody aftermath is horrible. In Oliver Twist there is even blood on Sikes's dog, while Grimwood's squalid bedroom became a bloodbath."
They suspect that the killer was her pimp/lover/cousin, Hubbard, although that wasn't ever proven conclusively.
The point, however, was that Dickens wasn't being as outlandishly melodramatic with Nancy's death as he has often been accused of being. He in fact toned down the murder a bit. Imagine if he pulled a CSI-type move and made it more like Grimwood's. Oh, the shock!
[READ THE FULL ARTICLE HERE]