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The NBA is moving toward one of its most significant rule changes in years, not on the court but in how teams build their futures. At the centre of it is a long-running problem known as “tanking,” and a proposed solution called the “3-2-1 lottery” that would change how young talent enters the league. According to reporting by Shams Charania of ESPN, the league has formally presented the proposal to all 30 team general managers, with a vote by the board of governors expected on May 28. The framework has been discussed across multiple meetings involving owners, executives and the competition committee, and while small adjustments remain possible, the core idea already has broad support. To understand why the league is considering such a shift, it helps to start with the system that exists today, and why it has created unintended incentives.
What “tanking” means, and why it became a problem
In simple terms, tanking refers to a team deliberately weakening its chances of winning games, often toward the end of the season, to secure better draft picks for the following season. The draft is the league’s annual system for allocating new players, typically from colleges or international leagues, to NBA teams. The teams that perform worst during the regular season are given the best chance of selecting first, which matters because the top pick often brings a franchise-changing player. To prevent teams from simply finishing last and automatically receiving the first pick, the NBA uses a lottery system. This is a weighted draw that determines the order of the top selections, with worse teams receiving better odds. Even with that system in place, the incentive remains clear. If finishing near the bottom improves your chances of landing a top prospect, then losing games, especially late in the season, can become strategically valuable. That is the behaviour the league is now trying to discourage. NBA commissioner Adam Silver addressed the issue directly earlier this year, saying the current structure pushes teams “to do whatever they can to maximize their chances” in the lottery and confirming that reform is a priority. Two teams were fined in February for conduct the league described as prioritising draft position over winning, with the Indiana Pacers penalised $100,000 and the Utah Jazz $500,000.
How the current draft lottery works
Under the existing system, 14 teams that miss the playoffs enter the draft lottery. The teams with the worst records are given the highest probability of securing the number one overall pick, although the odds are partially flattened compared to earlier versions of the system. The intention behind that earlier reform, introduced in 2019, was already to reduce tanking by making the worst three teams share similar odds. But even with that adjustment, finishing at or near the bottom still carries an advantage. That is the dynamic the new proposal is trying to reverse.
What the “3-2-1 lottery” proposal changes
The proposed system introduces several connected changes, all built around the same idea: being the worst team in the league should no longer be the most rewarding position. First, the lottery would expand from 14 teams to 16 teams. This means more teams remain in contention for top draft positions, widening the competitive field. Second, and more importantly, the distribution of lottery odds would be reshaped. The model is called “3-2-1” because it assigns different numbers of lottery chances, often described as “balls” in the draw, depending on where a team finishes. Teams that finish just above the very bottom, specifically those ranked from the fourth-worst to the tenth-worst records in the league, would receive the strongest advantage. These teams would be given three lottery balls each, effectively making them the most likely group to land the number one pick. By contrast, the teams with the three worst records would move into what the proposal describes as a “relegation zone.” Those teams would receive only two lottery balls each, meaning their odds would actually be worse than teams that performed slightly better over the season. The message is straightforward. Instead of encouraging teams to lose as many games as possible, the system would reward teams that remain competitive enough to avoid finishing at the absolute bottom.
How the rest of the system would be structured
The proposed “3-2-1” NBA draft reform is designed to reduce intentional losing, or “tanking,” by reshaping how draft positions are awarded and how late-season standings are treated. Under the plan, all 16 teams that miss the playoffs would enter the draft lottery, instead of only the worst performers having the strongest odds.To reflect how close a team came to making the postseason, the system ties draft lottery chances to both regular-season finish and performance in the NBA’s Play-In Tournament. The Play-In acts as a mini-postseason for teams that finish 7th to 10th in each conference, while teams ranked 1st to 6th automatically qualify for the playoffs.In the Play-In, teams compete for the final two playoff spots in each conference. The 7th and 8th placed teams face each other first, with the winner securing the 7th seed and a direct playoff berth. The loser is not eliminated immediately but gets a second chance by playing the winner of the 9th vs 10th game. The winner of that final matchup takes the 8th and final playoff spot, while the loser is eliminated from the postseason entirely.Under the proposed reform, draft lottery odds are also used to reflect how competitive teams were over the season and how close they came to the playoffs. Teams finishing 9th and 10th would receive two lottery balls as a reward for staying competitive and reaching the Play-In zone, effectively acting as a stronger consolation for narrowly missing the postseason.By contrast, 7th and 8th seeds would receive only one lottery ball if they fail to qualify through the Play-In, as they are viewed as the strongest of the non-playoff teams and therefore least in need of draft assistance.The reform also restructures late lottery picks, with selections 12, 13 and 14 effectively reserved for teams that narrowly miss the playoffs, often described as the “best of the rest.” In addition, it bans protected picks in the 12–15 range to ensure traded draft assets are fully honoured, and introduces safeguards to prevent teams from receiving consecutive No. 1 picks or multiple top-five selections in successive years. For the teams in the bottom three, there is a partial safety net. While they would have reduced odds of landing the top pick, their draft position would not fall below number 12.
Why the league believes this will change behaviour
The central idea behind the reform is rooted in behaviour rather than pure mathematics, as the league is trying to reduce the incentive for teams to lose deliberately while also increasing competitiveness across the league. A team sitting near the bottom late in the season would no longer benefit from slipping further down the standings. In fact, it would have a reason to win games and move out of the bottom three, where the lottery odds are weaker. At the same time, teams just outside that bottom tier would have an incentive to keep competing, because their position, rather than a worse one, would now carry the best chance of securing a top prospect. As Charania reported, league officials believe the system would “encourage winning, particularly during the second half of the season,” when tanking behaviour has historically been most visible.
Timeline and what happens next
The proposal is not yet final. The NBA’s board of governors is expected to vote on May 28, and the system could still undergo minor adjustments before any formal adoption. If approved, the changes would take effect from the 2027 NBA Draft, with a built-in review period. The proposal includes what is known as a sunset clause, meaning the system would run through the 2029 draft before the league decides whether to continue with it or introduce further changes. That timeline aligns with the current collective bargaining agreement, which runs through the 2029–30 season.
A league trying to rebalance incentives
The NBA has adjusted its draft system before, most recently in 2019, but this proposal represents a more direct attempt to reshape incentives across the league. At its core, the issue is not just competitive balance but credibility. When teams are seen to benefit from losing, it affects how the league is viewed by fans, players and commercial partners. Silver acknowledged as much when he described the decision as one with “business implications, basketball implications, [and] integrity implications,” adding that the league is committed to fixing the issue. The “3-2-1 lottery” is the clearest sign yet of how far the NBA is willing to go to do that, by making sure that, over the course of a season, trying to win is once again the most rational strategy.
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