Naismith thought back to his boyhood in Canada, where he and his friends had played "duck on a rock," which involved trying to knock a large rock off a boulder by throwing smaller rocks at it. He also recalled watching rugby players toss a ball into a box in a gymnasium. He had the idea of nailing up raised boxes into which players would attempt to throw a ball. Naismith had two bushel baskets, used for carrying peaches, nailed to the balcony at opposite ends of the school’s gymnasium. He set up two nine-man teams, gave them a soccer ball, and told them the object was to toss it into the basket being defended by the opposing team. Most of the rules Naismith drew up still apply in some form today. He called the game Basket Ball, the modern version of which is played by over 250 million people worldwide in an organized fashion, as well as by countless others in "pick-up" games.

Basketball gained quickly popularity due to its simple equipment requirements, indoor play, competitiveness, and easily understood rules. The first professional basketball league was formed in 1898. Today, the National Basketball Association (NBA) is the major professional basketball league in the world, with teams in the United States and Canada. The NBA now has 29 teams competing in two conferences, the Eastern and Western, in four separate divisions. Every year, in the second week of February, the NBA interrupts its season to celebrate the annual All-Star game, featuring the game's best players as selected by fans throughout the United States and Canada. At the end of the season, the champions from the Eastern and Western conferences meet in a best-of-seven series to determine the NBA champion.

Superstar players like Michael “Air” Jordan increased the popularity of basketball internationally. In 1992, a so-called Dream Team, made up of the top American professional basketball players, represented the United States in Olympic Games for the first time. Many teams in the National Basketball Association now have foreign players, who return home to represent their native countries during international competitions, such as the Olympic Games. Dirk Nowitzki who plays for the Dallas Mavericks is Germany’s most popular sports exports to the United States. More than 200 national federations belong to FIBA, the Federation of International Basketball, an independent organization that governs international basketball.

Since its invention, basketball has also been a popular sport for women. Basketball was also a popular sport for women. Women's basketball came of age with the gold-medal victory of the American women's basketball team at the 1996 Olympics, increased media attention to women's college basketball tournament, and the establishment of professional women's basketball leagues. The Women’s National Basketball Association (WNBA) was founded in 1997.

Basketball has a unique appeal. As one sport journalist explained, “The deep appeal of basketball lies in the fact that the poorest of kids can make it rich, and that there is a mystery in how he does it. Neither baseball nor football creates the special, jazzed-up excitement of this game in which the human body can be made to do unearthly things, to defy gravity gracefully. A trust in mystery is part of the foolishly beautiful side of the American dream, which actually believes that the impossible is possible.”