The Rockets struggled with a 6–11 start to the season, then played around .500 as they traded Jim Jackson to the New Orleans Hornets for David Wesley in late December.
At midseason, the team traded Maurice Taylor to the New York Knicks, and acquired Mike James from the Milwaukee Bucks.
The Rockets won their final seven games finishing third in the Southwest Division with a 51–31 record, which was their first 50-win season since 1997.
However, in the first round of the playoffs, they lost to their in-state rival, the Dallas Mavericks in seven games after taking a 2–0 series lead.
Roster Last transaction: March 19, 2005 One notable game during the season was the Rockets' December 9 matchup against the San Antonio Spurs.