The 1977–78 season was Port Vale's 66th season of football in the Football League, and their eighth successive season (14th overall) in the Third Division. Finishing in 21st place, they were relegated to the Fourth Division. Roy Sproson was sacked in October after a poor start to the season, though things did not improve under his replacement Bobby Smith, despite Smith spending big money to bring in new players. Smith also left the club at the end of the season.

The pre-season saw manager Roy Sproson attempt to re-sign Sammy Morgan for £12,000, however Morgan refused personal terms. Former Player of the Year David Harris also refused terms and demanded a transfer, so Terry Alcock re-joined on a month's trial to take his place. Three players arrived on free transfers: Jeff Hemmerman and Grahame McGifford from Hull City, and Bill Bentley from Blackpool. On a 28 June meeting, Sproson was severely criticized for his poor judgement of players and his seeming to place greater priority on his newsagent business than the club. Sproson did not attend the meeting, but was informed the board would review his position after fifteen games.The Football Association also hit the club with a £500 fine for their continuing problem with player indiscipline, despite Sproson's argument that no Vale players had been sent off in the last two years.

The season began poorly, though Harris returned to the first eleven and Alcock thus departed. Keeper John Connaughton picked up a knee injury, whilst a reporter from The Sentinel was allegedly told "I'll kill you" by a club official after he criticized the team in the paper. The reporter noted that "there is disenchantment in the air". The situated was calmed on 27 September, when Vale beat high-flying Colchester United 3–2 at Layer Road, reserve keeper Trevor Dance making a double penalty save. This was only a reprieve for Sproson however, as Vale would go the next fourteen league games without a victory, and the Vale Park faithful turned against the team. This run was not too damaging however, as eleven of the games were draws. Included in this was a club record streak of six home draws, lasting from 10 October to 27 December. Sproson complained of Mick Cullerton's attitude, and had to endure speculation of former Stoke City manager Tony Waddington taking his job. Sproson was sacked in October, and he rejected the offer of an executive position at the club.Colin Harper was made caretaker-manager. The board tried and failed to attract Bill McGarry to the vacant managerial position, and so advertised the position with a significant salary increase to attract applicants. On 17 November, Bobby Smith was sacked as Bury manager, and the next day walked into the Vale job. He appointed Dennis Butler as his assistant, as Harper left the club. Sproson also returned to Vale with an offer 'to help in any capacity'. Victory finally came on New Year's Eve with a 3–0 win over Rotherham United. Soon after this the 'Vale Lottery' was introduced, which proved to be a real money-spinner, and a five-a-side pitch was built for training.

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