Understanding Chabad
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Here are translations of excerpts from Rav Shach's letters (printed in Mechtavim v'Ma'amorim volume 3, pages 100-102).

"...His followers have reached the lowest level, to speak things that are forbidden to say or even to hear; to designate the building they've built for their leader with the name "Third Temple".   And they've shamelessly done things that our fathers would never have even imagined.
"For this, I see it as my responsibility to warn (for the many people who can't properly distinguish between right and wrong) how we should separate from them and their multitudes, and HaShem should send us quickly Moshiach Tzidkainu, and not test us with false messiahs"
"I have heard that in the yeshiva there are many who have been distracted by the study of books of the chassidus of Chabad.  This isn't according to the tradition of our teachers and it is better to learn Sha'arei Teshuva l'Rebbainu Yona, Mesilas Yesharim, Nefesh Hachaim and similar mussar seforim.  For more than this there is no need and [on the contrary] it can cause more harm than good.  But especially the sichos of Chabad, that today contain things that are forbidden to hear (including) many words of kefira therefore it is necessary to warn about this - but to do it intelligently."

For an intimate account of Rav Shach's own struggles and conviction in his battle against Chabad, see this article written by Israeli MK (and former cabinet minister) Rabbi Shlomo Lorincz.