On March 6, 1967, the American Basketball Association awarded the franchise that became the Kentucky Colonels to Don Regan for $30,000. Later that year the franchise was bought by Joseph Gregory, Mamie Gregory, and William C. Boone.

John Givens was named the first coach of the Colonels.

The Colonels draft picks were used on UK standout Louie Dampier, who signed with the Colonels; Western Kentucky University standout Clem Haskins, who signed with the NBA’s Chicago Bulls; Bob Verga, who signed with Dallas, and Randy Mahaffey, who signed with the Colonels. The team also signed Darel Carrier (WKU) and Jim “Goose” Ligon (from Kokomo, Indiana). The Colonels’ 1967 – 1968 roster was rounded out with Kendall Rhine (Rice University), Stew Johnson (Murray State), Rubin Russell, Bill Bradley (Tennessee Tech), Cotton Nash (UK), Bobby Rascoe (WKU), Howard Bayne (Tennessee), Orbie Bowling (Tennessee) and Tommy Woods.