It was a mutual decision, with the Mavs planning to re-sign Nowitzki in July. If the Mavs use all of their cap space, they can utilize the cap-room exception of $4.4 million to re-sign Nowitzki, who has taken several discounts to help Dallas have flexibility to pursue other players during his career.
The New York Times first reported the decision on Nowitzki's option.
Jordan declined the option on the final season of his contract with the Clippers, clearing the way for him to likely sign with the Mavs, sources told ESPN's Adrian Wojnarowski.
The Mavs now have approximately $27 million in salary-cap space. Jordan would have made $24.1 million if he exercised the player option in his contract with the Clippers.
Nowitzki, 40, is poised to set an NBA record for the longest career spent with only one team as he enters his 21st season with the Mavericks. Nowitzki and Los Angeles Lakers great Kobe Bryant are the only players in league history to play 20 years with one franchise.
The only players in league history to play 21 total seasons are Kevin Garnett, Robert Parish, Kevin Willis and Moses Malone (including his two ABA seasons). Free-agent swingman Vince Carter, like Nowitzki a lottery pick in the 1998 draft, would also join this club if he accomplishes his goal of playing one more season.
Nowitzki, a 13-time All-Star who has won an MVP and NBA Finals MVP, has been noncommittal about whether this will be the final season of his career. He has repeatedly said that he will go year by year and does not want the spotlight of a farewell tour.
Nowitzki had surgery to clean up bone spurs in his left ankle in April, undergoing the operation then to maximize the time he would have to prepare for this season. He is expected to be fully cleared for basketball activities well in advance of training camp.
Nowitzki has been the face of the Mavericks' franchise for most of the past two decades. That included a stretch of 11 consecutive 50-plus-win seasons from 2000 to 2011 -- a run bettered only by the Lakers from 1979 to 1991 and San Antonio Spurs from 1999 to 2017. The stretch of 50-plus-win seasons featured two NBA Finals appearances and was capped by a championship in 2011.
The Mavs have missed the playoffs in consecutive seasons for the first time since the first two years of Nowitzki's career, bottoming out with a 24-58 campaign last season. Dallas, one of few teams with significant salary-cap space, hopes to fast-track the rebuilding process and return to the playoffs this season.
The Mavs believe their draft-day trade for No. 3 overall pick Luka Doncic, the 19-year-old EuroLeague MVP, was a major step toward putting a competitive product on the floor this season and for the foreseeable future. Doncic, who was born a few weeks after Nowitzki made his Mavericks debut, has expressed an eagerness to learn from his new teammate, whom the rookie refers to as "a legend."
With 31,187 career points, Nowitzki ranks sixth on the NBA's career scoring list. LeBron James (31,038 points) is likely to pass Nowitzki early in the season, but Nowitzki could pass Wilt Chamberlain (31,419) and has a chance at catching Michael Jordan (32,292).
Nowitzki scored 927 points last season, averaging 12 points in the 77 games he played.