The NBA Board of Governors approved significant changes to the draft lottery system on Thursday in a 29-1 vote, with Memphis casting the sole dissenting ballot. The new "3-2-1 Lottery" system is designed to discourage tanking by reducing the draft odds for teams with the worst records.

Under the new system, which will be implemented for the next three seasons through 2029, the three worst teams will receive only 5.4% odds of winning the top pick, down from previous lottery structures. Teams finishing with the fourth through tenth worst records will have 8.1% chances of winning the first overall selection. The lottery will expand from 14 to 16 participating teams.

The system assigns lottery balls based on team performance, with the losers of the seventh versus eighth seed play-in games receiving one ball each, ninth and tenth seeds getting two balls, and remaining non-playoff teams receiving three balls. However, the three worst teams will have one ball removed as part of the anti-tanking mechanism, entering what the league calls "draft relegation."

The changes come after a season where tanking became a prominent issue. The Utah Jazz were fined $500,000 for conduct detrimental to the league related to holding out top players in fourth quarters. Five teams, including draft lottery winner Washington, Indiana, Memphis, Brooklyn, and Utah, had winning percentages below .180 after the All-Star break, marking an unprecedented level of late-season losses.

Additional provisions include preventing teams from winning consecutive number one picks and granting the NBA expanded disciplinary authority to address tanking, including the ability to lower lottery odds or change draft positions. The Board of Governors will need to vote again before 2030 to either extend or modify the system.