In professional sports, a free agent is a team player whose contract with a team has expired, and the player is able to sign a contract with another team. The term came into wide use in North America after sports leagues stopped using a "reserve clause" after much acrimonious collective bargaining, which provided a repetitive option for the club to renew the contract for one more year, but did not allow the player to terminate the relationship with the team. The result of the reserve clause was abusive from the player standpoint so that a player was essentially property of the team. Once in free agency, a player is in a "pool" of free agents, from which teams can sign players who are able to drive hard bargains in the employment market place since the owners now must compete for their talents.

In Europe some countries such as Spain had a system whereby footballers were entitled to a free transfer at the end of their contract. In most countries however this was not the case until the 1995 Bosman ruling by the European Court of Justice which established this right for players in all EU member nations. This ruling initially only encourage the transfer of players between clubs as did not have the same effect as the Seitz ruling in American sports. Players were still tied to their clubs unless their contract ran out. The Webster ruling, however, has in theory the same freedom clauses that will allow players the opportunity to move between nations, but will not free footballers to move within the national league they currently play in.

The Bosman ruling has since been extended to cover other professional sports and players from Eastern Europe.