The league included eight teams, broken up into Eastern and Western divisions, which played a 14-game official schedule, culminating in a league championship game.
After the end of the previous season, the Miami Seahawks had accrued $350,000 dollars in debt, prompting owner Harvey Hester to declare bankruptcy and the AAFC to shut down the team. They would be replaced in the Eastern division by the Baltimore Colts. The Buffalo Bisons chose to rename their franchise, holding a contest to determine the new name. The winner requested the new name to be the Buffalo Bills, named after "Buffalo Bill" Cody
The Chicago Rockets had experienced some disorganization in 1946. In a remarkable move, Commissioner Crowley (a successful former college coach) gave up a five-year contract to become their part-owner and coach. Admiral Jonas H. Ingram was named to replace him as commissioner.
To replace the Seahawks, the Baltimore group turned down in 1945 was issued a franchise. The new Baltimore Colts would play in Municipal Stadium. Meanwhile, the Bisons were renamed the Bills and the NFL added a 12th game to its schedule.
The AAFC enjoyed its most successful season in 1947. Some notable guests watched the Browns' opening game: the entire coaching staff of the 1946 NFL champion Chicago Bears. The 49ers obtained the rights to Army's legendary Heisman Trophy winners Felix Blanchard ("Mr. Inside") and Glenn Davis ("Mr. Outside"), and amid great publicity unsuccessfully attempted to get the military to permit them to play during their post-graduation furloughs. In other highlights, a Yankees–Dons game in the Los Angeles Coliseum drew a pro record of more than 82,000, and division leaders New York and Cleveland locked horns on November 23 in the most famous game in AAFC history. Before more than 70,000 fans at Yankee Stadium, the Browns rallied from a 28–0 deficit to tie 28–28.
New York won the East with an 11–2–1 record, 2½ games ahead of Buffalo, with Brooklyn and Baltimore far back. Cleveland, led by MVP quarterback Otto Graham, won the West with a 12–1–1 record, 3½ games ahead of San Francisco. Los Angeles followed, and Chicago was last at 1–13. Former Commissioner Crowley would not return either as coach or owner.
The title game was a defensive struggle, with the Browns again defeating the Yankees, 14–3.
By this time a pattern had emerged among the franchises. The Browns, Yankees, 49ers, Dons, and Bills all had stable ownership and at least one winning season. The Browns led both leagues in attendance by a wide margin, the Yankees and Dons outpaced their crosstown NFL rivals on the field and at the gate, and the 49ers and Bills (despite a small stadium) also enjoyed good attendance.
However, the Dodgers, Rockets, and to a lesser extent the Colts were having serious problems. Playing near the Yankees and the NFL Giants, the Dodgers drew fewer than 12,000 fans per game, least in both leagues. The Rockets faced the NFL's flagship Bears and a Cardinals team enjoying rare success. After a decent start in 1946, the Rockets collapsed on the field and found themselves playing before tens of thousands of empty seats in huge Soldier Field. The first-year Colts did reasonably well at the gate but finished last. All of these teams were at the bottom of the standings and all were sold after the 1947 season, the Rockets for the second time.