The 1996–97 NBA season was the Bucks' 29th season in the National Basketball Association. In the 1996 NBA draft, the Bucks selected Georgia Tech point guard Stephon Marbury with the fourth pick, but soon traded him to the Minnesota Timberwolves for rookie shooting guard Ray Allen out of Connecticut. Offseason acquisitions included signing free agents Armen Gilliam and Andrew Lang, while acquiring Elliot Perry from the Phoenix Suns. Under new head coach Chris Ford, the Bucks appeared to be on their way breaking out of the gate with a 15–11 start. However, they couldn't maintain that momentum and missed the playoffs again by finishing seventh in the Central Division with a 33–49 record. Vin Baker made his third straight All-Star appearance in the 1997 NBA All-Star Game, and Allen was selected to the All-Rookie Second Team averaging 13.4 points per game.

Following the season, Baker was traded to the Seattle SuperSonics in an offseason three-team trade, Johnny Newman was dealt to the Denver Nuggets, and Sherman Douglas, who was involved in a trade with Cleveland signed as a free agent with the New Jersey Nets.