During the offseason, the Rockets hired head coach Jeff Van Gundy, who is best known for his tenure with the New York Knicks, and signed free agent Jim Jackson.
The Rockets finished fifth in the Midwest Division with a 45–37 record, and qualified for the playoffs for the first time since 1999 as the number 7 seed in the Western Conference.
Second-year star Yao Ming and Steve Francis were both selected for the 2004 NBA All-Star Game.
However, the Rockets were eliminated from the first round of the playoffs by the Los Angeles Lakers, who added Karl Malone and Gary Payton to join Shaquille O'Neal and Kobe Bryant, in five games.
Following the season, he was traded along with Cuttino Mobley and Kelvin Cato to the Orlando Magic,[2] and Mark Jackson retired.