There is relegation. All the teams that aren't the Lakers, Heat, or Thunder have been relegated to the secondary league of the NBA. The goal of this second tier is secure the #1 pick in the draft lottery, a process known as "dat tank." The only way to return to the top league is to secure enough high-ranking draft picks that the President of Basketball, David Stern, judges you to be a good team and places you back into the top league. Oklahoma City achieved this when they drafted Russell Westbrook and James Harden. Current favorites to re-enter the top league are the New Orleans Hornets and the Los Angeles Clippers. Brooklyn has also been granted automatic waiver status to the top league as a consequence of their move to Brooklyn from New Jersey.
Several teams have been relegated recently. The most recent example is the Orlando Magic, who were sent to the secondary league as a punishment when their General Manager was convicted of fraud and embezzlement. This punishment also stripped them of their best player and sent him to a top league team. They were also forced to resign Jameer Nelson as part of the punishment. Most NBA observers agree these punishments will deter such misbehavior in the future.