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The NBA Draft is divided into two rounds. The order of selections is based on certain rules. The first turns of the draft belong to the 14 teams that did not enter the playoffs in that year's season. These teams participate in a lottery that determines the spot each team will have in the draft.
The next 16 spots in the draft are reserved for the teams that made it into that season's playoffs. The order of these 16 teams' selection is determined by their regular-season win-loss record, going from worst to best. Therefore, the team with the best record selects last in the draft. Note that the team with the best record is not necessarily the champion; for example, in the 2004 NBA Draft, the last pick did not go to the NBA champion Detroit Pistons, but rather to the Indiana Pacers.
This same order is carried on to the second round. However, teams are allowed to trade their turns in the draft during season player deals. Therefore, the structure of the second round can sometimes be very different than that of the first round because of trades.
Every team in the league is obligated to make at least one selection during the entire draft. Also, league rules prohibit a team from making trades that would result in that team not having a first-round pick in consecutive years. This rule was created partially as a reaction to the practices of the Cleveland Cavaliers in the early 1980s, whose owner at the time, Ted Stepien, constantly traded away his team's top picks for players of questionable value, nearly destroying the franchise in the process.
U.S. players are allowed to declare their eligibility for the draft at any time between high school graduation and completion of college eligibility, as long as they are 18 years old at the draft date. International players may declare eligibility if their 18th birthday falls on or before the draft date. The NBA has established two draft declaration dates. All players who wish to be drafted, and are not automatically eligible, must declare their eligibility on or before the first declaration date. Following this, the NBA runs several pre-draft camps for prospective draftees to allow them to show their skills to the league's teams. A player may withdraw his name from consideration from the draft at any time before the final declaration date, one week before the draft date. This can be important for college players. Players do not lose their college eligibility by declaring for the draft on the initial date; however, if they stay in the draft at the final declaration date, they lose further college eligibility, whether or not they are drafted. Also, signing with an agent automatically ends a player's college eligibility.
When a player is selected in the first round of the draft, the team that selected him is obligated to sign him to at least a one-year contract. Players selected in the second round are "owned" by the team for three years, but the teams are not obligated to sign them.
The earlier in the draft a player is selected, the higher his worth. The first pick of the draft is usually the best player available in the field. However, being the first pick doesn't necessarily means that the player will be a superstar. Michael Jordan was the third pick of the 1984 NBA draft, and yet he is generally recognized as the greatest player of all time. The two players selected ahead of Jordan in that draft illustrate the uncertainty of the draft. The first pick, Hakeem Olajuwon, went on to a career that will almost certainly put him in the Hall of Fame. The second pick, Sam Bowie, ended up a journeyman with a relatively short and injury-riddled career.