The running shorts were long, the swimming pool went green, and some of the winning athletes were helped along both by friends and alcohol, yet London's first Olympics, held in 1908, set the template for the modern international event. It was a Games hailed as a moment of hope for humanity – a hope soon to be let down by the Great War – although it only came to England at the last minute because of a volcano in Italy.

The IV Olympiad was to have been staged in Rome, but the eruption of Vesuvius in 1906 destroyed large parts of Naples and funds were diverted to rebuild the city. Luckily a young British sportsman and aristocrat, visiting Italy for a fencing competition, stepped forward and offered the services of his own country.

That man was William Grenfell, Lord Desborough, and next month an exhibition at his former home, Taplow Court, near Maidenhead, will reveal how he and his freshly minted British Olympic Association managed to find a site, build a stadium and organise the finance to host teams from 22 visiting nations without much government help.

Desborough, who had become an MP at 25, was a former "double blue" in rowing and running at Oxford. What is more, he had swum the rapids at Niagara twice and climbed the Matterhorn three times, to say nothing of representing his country at fencing, or of chairing the Lawn Tennis Association and the MCC. He was the original all-rounder.

Although there was no Olympic torch at the 1908 Games, as the tradition did not start until 1928, on 10 July this summer the 2012 torch will pass by Taplow Court en route to the London Games in tribute to his sporting legacy.

Desborough's pioneering games, staged at the White City in west London, is often remembered for such abortive events as "motor boating" (which saw stately competition speeds of up to 19mph – or would have done, if anything had been visible from the shore in Southampton), or the tug-of-war competition (also a doubtful success, with the winning team of Liverpool policemen criticised by opponents for wearing regulation steel-tipped boots).

And yet many of the established rules of international sport were laid down at the 1908 Games, including the eccentric length of the standard marathon course (specially lengthened to finish by the royal box). It was also the first Olympics to see national teams compete against each other for points and medals. Great Britain and Ireland led the awards tables to the end, winning a total of 56 golds, but this sadly did not go on to establish an Olympic convention.

The Games were held over six months, from April to October, with the main stadium events taking place between 13 and 25 July in a structure put up by the master builder George Wimpey for £60,000 of government money, complete with running and cycling tracks, a wrestling and gymnastics platform and a 100ft by 15ft "great bath". The stadium could hold 68,000 seated spectators, with standing room for 23,000 more.

Concerns over the weather and the price of tickets were shared with the 2012 Games. The 1908 Olympics eventually went down as the wettest in history, prompting the Observer to run a poem with these closing lines:

But you, old sky, shall never falter,

Nor lose your boasted fame;

the beef of England's sons may alter,

Her climate is the same.

Whoever else is out of training,

One backs you as a cert,

For coming through the ruck

and raining

With one tremendous spurt!

The Taplow exhibition will show the impact of Desborough's family on the 1908 Games. His wife, Ettie, was a renowned socialite, but also a fan of sport and cycling. Her two eldest sons, Julian and Billy, were keen sportsmen at Eton and at Oxford and attended the Games throughout. Later, Julian came to be celebrated for his stirring war poem, Into Battle, published in 1915.

In 1910 Desborough said, with misplaced optimism: "In the Games in London were assembled some 2,000 young men… representative of the generation into whose hands the destinies of most of the nations of the world are passing at this moment… and we hope that their meeting… may have a beneficial effect hereafter on the cause of international peace." Five years later the Grenfell brothers died on active duty within eight weeks of each other. A memorial sculpture was commissioned from the artist Sir Bertram Mackennal and still stands in Taplow's grounds.

For the curator of the show, Angela Bolger, there is a nice connection between Desborough's thwarted hopes for the Games and the current owners of his home, the SGI-UK, the Buddhist group which runs Taplow Court as a research centre for peace studies. "He was so concerned with the harnessing of hope and of goodwill between nations," said Bolger this weekend.

Today international conferences are staged at Taplow Court, but during the Desboroughs' heyday it was a bolthole for an artistic aristocratic set known as The Souls. The house was visited by royalty, too, by writers such as HG Wells, and the dancer Isadora Duncan, who gave a performance on the lawn in Olympic year.

While there were just under 2,000 male entrants in the games, 37 women also took part, competing in archery, tennis, ice skating and yachting. Three weeks before the Games opened, a "monster meeting" demanding votes for women took place in Hyde Park and the pressure applied by the suffragettes may have resulted in Lord Desborough becoming a vocal advocate for more "ladies' events" in future Olympics.

But the most controversial element of the 1908 games was the aggrieved attitude of the American team. At the opening ceremony the American and Swedish flags were not flown and the Swedes stormed out of the stadium, while the Americans launched an official protest and deliberately failed to dip their flag to the royal box. American athletes also lodged complaints about the length of shorts and the presence of coaches on the track. They also understandably questioned the decision to give a gold medal to test cricketer Johnny Douglas in the middleweight boxing division. A final verdict on a split decision was called by the referee, Douglas's own father.

Olympic history was made in the 400m when the Americans refused to take part in a re-run and Wyndham Halswelle had to take to the track alone. He remains the only British athlete to have the full collection of gold, silver and bronze medals [see footnote]. He was killed in 1915 by a sniper at Neuve Chapelle.

The grand finale of the games was the marathon and this, too, made Olympic history. The favourite, Canadian Tom Longboat, collapsed at 19 miles after sipping champagne along the course, which started near Taplow at Windsor Castle. An Italian confectioner called Dorando Pietri then led the race all the way into the stadium, where he also succumbed to heat exhaustion, hastened perhaps by the brandy he used to refresh himself. He collapsed five times on the track and was helped across the line by supporters. After another official complaint, Pietri was disqualified and an American runner, Johnny Hayes, was given the gold.

The Observer had looked forward to the marathon with the robust patriotism of the times. "If the weather is fine, the finish of this Homeric struggle ought to be a magnificent scene. Whether the United Kingdom wins it or not, enough has been done to show that the complaints about the physical decadence of the Mother Country are for the most part clotted nonsense."

• The following correction was published on 11 March 2012:

A factbox headed "Fraizer's Rise" (Sport) wrongly maintained that Fraizer Campbell could not save Hull from relegation in 2007. Hull won promotion to the Premier League in 2008 when he set up Dean Windass to score against Bristol City. And "Champagne marathons and tug-o'-wars" (News) said Wyndham Halswelle "remains the only British [Olympic] athlete to have the full collection of gold, silver and bronze medals", but David Hemery and Mary Rand share the distinction as do fellow British Olympians Bradley Wiggins, Kathleen McKane Godfree and Josiah Ritchie.