The needs of the many outweigh the needs of the few, or the one. If the evil character is a problem for the majority of the party, then he's got to go.  If everyone is fine with it, except the goody two shoes paladin, then the goody two shoes can deal with it or leave.

What I will say, is that while I do not have a problem with evil characters on paper, I'd only allow someone to play one who I felt is mature enough to not cause social contract problems.  if I were running a campaign for a teenage group, evil would be strictly forbidden, and that's even if all of them were on board with being evil/party conflict, etc.

Quote from GiantOctopodes >>

Here's my 2cp.  I've played in many campaigns with secret evil characters, I've played secret evil characters, I've played in all evil campaigns, I've played in openly mixed good and evil campaigns, and I've played a character who had long ago been abducted, and I was effectively playing the BBEG, posing as my character who was being tortured to death for information, for months at a time.

So obviously I can't in good conscience just say "evil characters are bad, mmkay?", it wouldn't jive with what I've done and the fact that some of those campaigns and characters (especially playing as the BBEG) were Really cool, and Really memorable.  

However, here's the reality that you need to always keep in mind:  All of the characters in a party need to Actually Want to be there, and to be associated with the folks around them.  For evil characters, they have the easy side of it.  Being associated with good guys gets them in to places they wouldn't otherwise get into, it deflects suspicion, it has many many advantages.  For good characters playing with characters who perform openly evil acts, it's not true at all.  There is no reason they would want to be associated with the murder hobos / kleptomaniacs / chaotic stupid agents of destruction / assassins / whatevers of the world.  If the player thinks "my character wouldn't be here", they're likely not having fun, even if they don't say it.  Eventually, their character would just leave.  Perhaps they as a player will as well.

So here are my rules for when evil characters are ok, and when they're not:

- Evil characters are ok, if no one knows they're evil and they don't perform evil acts.  Super Secret Evil Guys are effectively, from the standpoint of other characters, not actually evil, and what's written on their character sheet ultimately doesn't matter, especially in 5e.

- Evil characters are ok, if everyone is evil or neutral, and everyone is on board with running an evil campaign.  There's no drama or strife or conflict there at that point.   Well, there likely will be a LOT of drama and strife and conflict, they're all evil, but at least everyone knows what they're getting into at the start, and the expectations are properly landed.

- Evil characters are ok if they add more to the campaign than they detract from it, without hogging the spotlight or making the whole thing all about them.

- Evil characters are NOT ok if the actions they perform are to the detriment of the party, or are actively opposed to other players interests and alignment, to the point where logically and realistically one of the two would just leave the party rather than them continuing to adventure together.

- Evil characters are NOT ok if they are a means of showboating, and spotlight hogging, and hours or days of adventure time or worse real life time are Constantly devoted to bailing them out of jail or otherwise trying to gloss over the consequences of their actions, while no one else ever gets to do what they want to do

- Evil characters are NOT ok if, in short, they take away or detract from the fun of one or more players at the table, if their fun comes at the Expense of others instead of adding to it.

It's tough to know how mature a player is, how effectively they can roleplay an evil character without causing problems, and what their intent is at the start, and it's SO MUCH harder and more annoying to have to have the conversation with the evil character about how they need to change their ways or change characters while they're whinging constantly about "but you said it was OKAAYY...", so many tables just ban them up front.  It's easier that way.  There is a place for them, sure, and they CAN add something to the campaign, sometimes they can add a lot, but it is SO Easy for them instead to delight the DM and exactly 1 person at the table, while pissing off literally everyone else.  It's a group game, the whole group needs to have fun, not just one person.

Raistlin is a perfect example of an evil character done right.

I think it would only cause problems if the evil character is evil to a cartoonishly absolute degree. I usually play a Lawful Evil Drow Cleric or something similar. It's pretty easy to invent reasons why I can operate within the context of a cooperative party. Just invent a reason why an exception is made for the party. And anyway, a bit of unpredictability or intrigue, or just a bit of doubt about a character's trustworthiness is the stuff interesting stories are made of.

Funny bit of nefarious play I got into while rolling an evil necromancer:

Party is relaxing at an inn. The necromancer is being broody and ominous while the others are socializing like normal people. The monk (Sun Soul) says something overly pious and goody-goody. Necromancer perks up and starts criticizing her virtues as misguided and asserts her methods are contrary to the ideals she preaches (very inquisiton/crusader-minded). There's no player animosity, but the characters are in a heated debate over moral perspective. The monk finally storms off before getting into open fighting.

Outside, the necromancer keeps a posse of 4 zombies wrapped tight in thick clothes (disguises) at the door and a raven familiar on the roof. When the monk storms out, she goes around back to try and meditate. However, the raven soon lands next to her and starts CAWWW'ing in a strange, rhythmic way. A zombie comes around the corner and begins wheezing in the same manner. Yes, the necromancer chose to add insult to injury by making his minions laugh at the pride-wounded monk. The monk's player thought that it was such a brilliantly evil use of the minions and telepathic control that she immediately turned the bird to powder and feathers with a radiant bolt.

I voted for the top option. My DM plays without alignments and we totally agree with it. It's not easy to make a character do only what that alignment to do with complex characters because that person will react as that person would and that is not always so cut and dry to fit a characters mindset into a single alignment. That said, if we play an "evil" character and they die due to their actions? That's on you. Re-roll.

My take:

• I don't want to be at a table where other players are lying to me. I want everyone around the table to be on the same team.

• I don't want to be on the same team as Darth Vader, The Joker, Moriarty, Magneto, Charles Manson, Anton Chigurh, Biff Tannen, Voldemort, Loki, etc.

• I don't want to GM such a team either.

I have seen one game (a flatmate's game, I wasn't in it) where a player was decieving the other players (the character had been pretending to be a good fighter but was actually an evil assassin working for the opponents). When the deception came to light, one player looked at the assassin's player and said, 'So you've been lying to us for a year and a half? I don't want to play with you again. Ever." The game split and some of those players were true mto their word, they never shared a table again.