The macroscopic fundamental diagram (MFD) traffic modelling method has been proved for large urban roads and freeway networks, but hysteresis and scatter have been found in both such networks. This paper investigates how incident variables affect the shape and scatter of the MFD using both simulated data and real data collected from the M3 Pacific motorway in Brisbane, Australia. Three key components of incidents are investigated based on the simulated data (i.e. incident location, incident duration and traffic demand). The results based on simulated data indicate that the diagram shape is a property not only of the network itself but also of the incident variables. Diagrams for three types of real incidents (crash, hazard and vehicle breakdown) are explored separately. The results based on the empirical data are consistent with the simulated results. The hysteresis phenomenon occurs both upstream and downstream of the incident location, but for opposite hysteresis loops. The gradient of the upstream diagram is greater than that downstream on the incident site, when traffic demand is for an off-peak period.