The franchise was established in 1967 as part of the American Basketball Association, with trucking magnate Arthur Brown as the owner. He had intended to call the team the New York Freighters, playing at the 69th Regiment Armory on Manhattan's east side, but pressure from the New York Knicks forced the Armory to back out three months before opening day. The team was forced to move to the Armory in Teaneck, New Jersey, and changed its name to the New Jersey Americans. It would not be the last time that the Knicks would directly affect the future of the franchise.
The Americans did fairly well in their first season, tying the Kentucky Colonels for the last playoff spot in the Eastern Division. However, the Armory was booked, forcing the Americans to scramble for a last-minute replacement. They found one in the Long Island Arena in Commack, New York. When the Americans and Colonels arrived for the game, they found the playing floor unfit for play due to numerous missing boards and bolts. League commissioner George Mikan forfeited the game to the Colonels.
For the second season, the team opted to stay on Long Island, where it changed its name to the New York Nets. The team was renamed to "Nets" to rhyme with the two other professional sports team in New York that played on Long Island at the time; Major League Baseball's New York Mets, and the American Football League's New York Jets.