The NBA Players' Association has rejected the league's latest offer for a collective bargaining agreement, casting doubt over the entire season.
The NBA wanted a 50-50 division of basketball-related income and a 72-game season beginning on 15 December.
But the NBAPA's Billy Hunter said it would no longer continue in collective bargaining and would dissolve the union to pursue legal action against the NBA.
"It's the best situation where players can get their due process," he said.
The scheduled start to the new season had already been delayed by five weeks because of the negotiations over a new agreement between the league and the players' association.
The players are seeking a minimum 52.5% share of teams' basketball-related income, but have indicated in recent days that they would accept 51% with an additional 1% going to a fund for retired player benefits.
The league's current offer gives players between 49% and 51%, but the players argue that 50.2% would be the best realistic outcome under the terms of that deal.
"We're prepared to file this anti-trust action against the NBA," continued Hunter. "The collective bargaining process has completely broken down."
Players' union president Derek Fisher added: "This is the best decision for the players.
"A lot of individual players have a lot of things personally at stake in terms of their careers and where they stand."