[1] Despite finishing with a 38–44 record the previous season, the Pacers had the second overall pick in the 1988 NBA draft, and selected 7' 4" Dutch center Rik Smits out of Marist College.
[2][3][4][5][6] Before the season began, center Steve Stipanovich was out with a left knee injury, and would be sidelined for the entire season after undergoing knee surgery.
[14][15] At mid-season, the team traded Wayman Tisdale to the Sacramento Kings in exchange for LaSalle Thompson and Randy Wittman,[16][17][18][19] and dealt Herb Williams to the Dallas Mavericks in exchange for German small forward Detlef Schrempf.
[25] Chuck Person averaged 21.6 points and 6.5 rebounds per game, while second-year star Reggie Miller showed improvement, becoming the team's starting shooting guard, averaging 16.0 points and 1.3 steals per game, Vern Fleming contributed 14.3 points and 6.5 assists per game, and Smits provided the team with 11.7 points, 6.1 rebounds and 1.8 blocks per game, and was named to the NBA All-Rookie First Team.
[26] Following the season, Stipanovich retired after five seasons in the NBA with the Pacers; Stipanovich had gone through two knee operations, and doctors discovered he had a "dead spot" in the bone of his left knee.