Einstein and others perhaps thought that this was a defect of the theory that should eventually be removed, by a supplemental hidden variable theory[6] that restores determinism; but subsequent work showed that no such hidden variables account could exist. At the microscopic level the world is ultimately mysterious and chancy.
So goes the story; but like much popular wisdom, it is partly mistaken and/or misleading. Ironically, quantum mechanics is one of the best prospects for a genuinely deterministic theory in modern times! Even more than in the case of GTR and the hole argument, everything hinges on what interpretational and philosophical decisions one adopts. The fundamental law at the heart of non-relativistic QM is the Schrödinger equation. The evolution of a wavefunction describing a physical system under this equation is normally taken to be perfectly deterministic.[7] If one adopts an interpretation of QM according to which that's it—i.e., nothing ever interrupts Schrödinger evolution, and the wavefunctions governed by the equation tell the complete physical story—then quantum mechanics is a perfectly deterministic theory. There are several interpretations that physicists and philosophers have given of QM which go this way. (See the entry on quantum mechanics.)
More commonly—and this is part of the basis for the popular wisdom— physicists have resolved the quantum measurement problem by postulating that some process of “collapse of the wavefunction” occurs from time to time (particularly during measurements and observations) that interrupts Schrödinger evolution. The collapse process is usually postulated to be indeterministic, with probabilities for various outcomes, via Born's rule, calculable on the basis of a system's wavefunction. The once-standard, Copenhagen interpretation of QM posits such a collapse. It has the virtue of solving certain paradoxes such as the infamous Schrödinger's cat paradox, but few philosophers or physicists can take it very seriously unless they are either idealists or instrumentalists. The reason is simple: the collapse process is not physically well-defined, and feels too ad hoc to be a fundamental part of nature's laws.[8]
In 1952 David Bohm created an alternative interpretation of QM—perhaps better thought of as an alternative theory—that realizes Einstein's dream of a hidden variable theory, restoring determinism and definiteness to micro-reality. In Bohmian quantum mechanics, unlike other interpretations, it is postulated that all particles have, at all times, a definite position and velocity. In addition to the Schrödinger equation, Bohm posited a guidance equation that determines, on the basis of the system's wavefunction and particles' initial positions and velocities, what their future positions and velocities should be. As much as any classical theory of point particles moving under force fields, then, Bohm's theory is deterministic. Amazingly, he was also able to show that, as long as the statistical distribution of initial positions and velocities of particles are chosen so as to meet a “quantum equilibrium” condition, his theory is empirically equivalent to standard Copenhagen QM. In one sense this is a philosopher's nightmare: with genuine empirical equivalence as strong as Bohm obtained, it seems experimental evidence can never tell us which description of reality is correct. (Fortunately, we can safely assume that neither is perfectly correct, and hope that our Final Theory has no such empirically equivalent rivals.) In other senses, the Bohm theory is a philosopher's dream come true, eliminating much (but not all) of the weirdness of standard QM and restoring determinism to the physics of atoms and photons.
This small survey of determinism's status in some prominent physical theories, as indicated above, does not really tell us anything about whether determinism is true of our world. Instead, it raises a couple of further disturbing possibilities for the time when we do have the Final Theory before us (if such time ever comes): first, we may have difficulty establishing whether the Final Theory is deterministic or not—depending on whether the theory comes loaded with unsolved interpretational or mathematical puzzles. Second, we may have reason to worry that the Final Theory, if indeterministic, has an empirically equivalent yet deterministic rival (as illustrated by Bohmian quantum mechanics.)