After the departure of the IHL’s Atlanta Knights 1992 to 1996 to become the Quebec Rafales, the city was awarded an NHL franchise on June 25, 1997, as part of a four-team tiered expansion. This also included teams in Nashville, Columbus and St. Paul, in which each new franchise would begin play as its respective new arena was completed. The birth of the new franchise marked NHL hockey’s return to Georgia, as the Atlanta Flames, established in 1972, departed for Canada in 1980 to become the Calgary Flames.

On September 21, 2003, Time Warner, the owners of both the Thrashers and the NBA’s Atlanta Hawks, sold both teams to Atlanta Spirit, LLC, a group consisting of businessmen based both in Atlanta and elsewhere.

Due to financial losses and ownership struggles, the team was frequently a target of relocation rumors. In later years, reports saw the team courted by suitors intending to relocate to Kansas City, Missouri; Quebec City, Quebec; Hamilton, Ontario or Winnipeg, Manitoba. On January 22, 2011, the team’s ownership group claimed it had lost US $130 million in the last six years, partially as a result of an ongoing lawsuit with former partner Steve Belkin. In February 2011, majority owner Michael Gearon stated that the team would be seeking new investors. Various local groups announced their intent to purchase the franchise and keep it in Atlanta, but ultimately the team was sold to the Canadian group True North Sports & Entertainment.