Placing more value on his own life than on his daughter, the mayor fled Raccoon City once the viral outbreak became evident. Katherine ended up in the protective custody of Brian Irons, chief of police at the Raccoon Police Department. Increasingly deranged, he planned to kill her and turn her into a taxidermy trophy. On September 29, he finally killed her, and stored her body in the nearby Orphanage to prepare for her dissection and embalming.
In the non-canon scenario, 'The Ghost Survivors', Katherine kills the Chief in self-defense and takes his prison keys - having lured her to him with promises of saving someone special to her. She fights for survival across the city to the precinct, where she finds Ben Bertolucci in the jail cell. She frees him and the two embrace, the two then flee the city together.
In the WildStorm version of the events of Resident Evil 2, Brian Irons outright admits he murdered her and plans to stuff her into a trophy.
In The Darkside Chronicles, Katherine's corpse is found in the taxidermy room, where Brian Irons makes clear he intends to stuff her. However, her corpse ends up knocked over by Irons when "G" bursts out of him.
A file in the Outbreak chapter of Resident Evil Outbreak hints that Katherine was not the first murder victim at the hands of Irons, as it mentioned that at least eight females had disappeared, that they could also be heard wailing underneath the sewer, and the females all matched a similar physical profile to her.
When first accessing the top floor in Resident Evil 2 (1998), the player can actually hear Katherine screaming (presumably from being killed by Irons).