The salary cap is the limit on how much a team may spend on player salaries in a season, set by the league's collective bargaining agreement.
The salary cap is the league's central economic rule: a ceiling on team payroll, calculated from league revenue and renegotiated in each collective bargaining agreement. The NBA's version is famously a soft cap, riddled with exceptions that let teams exceed it to re-sign their own players, sign minimum contracts, and use mid-level exceptions, which is why payrolls spread so widely above the line.
Its history is an era marker. The modern cap arrived in 1984 at a figure under four million dollars per team; by the 2020s it stood above one hundred forty million, and single television deals have spiked it suddenly, most famously in 2016, when a new broadcast contract jumped the cap by roughly a third in one summer and reshaped free agency overnight.
For fans, the cap is the grammar of every roster conversation: cap space, cap holds, and dead money explain why stars change teams and why some contenders cannot improve. Quiz questions in this category treat the cap as history and mechanism at once, and the glossary seeds it deliberately: no modern NBA vocabulary works until this term does.
In use"With two maximum contracts on the books, the salary cap left them almost no room to add help."