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Atomic-scale processes during displacement damage formation have been previously studied using molecular dynamics (MD) calculations and empirical potentials. Low-energy displacements (1 keV) are characterized by a high cross-section for producing secondary knock-on atoms and damage clusters, and determine the threshold displacement energy (an important parameter in NIEL calculations). Here we report first-principles, parameter-free quantum mechanical calculations of the dynamics of low-energy displacement damage events. We find that isolated defects formed by direct displacements result from damage events of les100 eV. For higher energy events, the initial defect profile, which subsequently undergoes thermal annealing to give rise to a final stable defect profile, is the result of the relaxation and recrystallization of an appreciable volume of significantly disordered and locally heated crystal surrounding the primary knock-on atom displacement trajectory.