Two-way contracts are a new feature in the NBA’s CBA (collective bargaining agreement) that allow a player to essentially be the 16th and 17th players on the roster. These two-way contracts allow the players to play in the G-League (formerly the NBA Development League, or D-League) and the NBA.
Presumably, these contracts will be used on developmental players with the potential to be NBA caliber players in the future. Here are some more two-way contract details.
Free agent guard Luis Montero is signing a two-way contract with the Detroit Pistons, source told HoopsHype. https://t.