Despite leading the Colts to the AFC Championship Game the previous season, head coach Ted Marchibroda left the team after failing to come to terms with the club on a contract extension. Offensive coordinator Lindy Infante was promoted to head coach. Ironically, Marchibroda would quickly be hired to coach the new and then-unnamed NFL franchise in Baltimore (they would eventually be named the Baltimore Ravens), thus returning to the city where he had previously coached the Colts when they were still based in Maryland.
On October 13 Indianapolis hosted the Ravens, thus not only pitting the Colts against the team based in their former home but also matching up Marchibroda against his former team. The Colts won 26–21. This game also has the distinction of being the first NFL on TNT broadcast after TNT's parent Turner Broadcasting System completed its merger with Time Warner only three days earlier.
The season saw the Colts draft Marvin Harrison. Harrison would go on to become a member of the Pro Football Hall of Fame, after spending his entire career as a Colt. Harrison was named to Pro Bowl several times and later helped the Colts win a Super Bowl in 2006. He continued to play for the team until 2008 and retired during the 2009 season.
The Indianapolis Colts finished the National Football League's 1996 season with a record of 9 wins and 7 losses, finished third in the AFCEast division and reached the playoffs for the second consecutive season. Their Wild Card round game would be a rematch of the previous season's AFC title game, but would not be nearly as close as the Colts would be blown out 42–14 by the Pittsburgh Steelers.
The team received a Wild Card playoff berth to the playoffs and traveled to Pittsburgh to play the Steelers. The Colts came back from a 13-point lead in the first half but the Steelers scored 29 unanswered points in the second half and went on to beat the Colts.