Another year, another KOF. Additions this year come in the form of slightly improved graphics and sounds, new moves and a new game mode. Gameplay is much more plot-driven, as you have middle-bosses that can change depending on what team you select. In addition, there are several special endings which are only shown when certain "Edit Team" combinations are selected.

As of The King of Fighters '97, you can play in either the Extra or Advanced game modes. Extra Mode is the typical AOF/KOF scheme, in which your power gauge fills up as you defend yourself or charge yourself up. The new Advanced Mode, on the other hand, only allows you to charge your gauge as you perform special moves and attacks, similar to the Street Fighter series. Extra allows one to sidestep attacks while Advanced allows the character to roll past and dodge attacks; Advanced also allow a character to perform a potent "Super Desperation Move" (or SDM) at any time provided the character has at least two full bars of charged energy stored. In contrast, SDMs can only be performed in Extra when a character has less than a quarter of their health left.

New characters include the New Face Team, the Fatal Fury Outlaw Team (featuring the KOF debut of "Blue" Mary Ryan and Ryuji Yamazaki, and the return of Billy Kane), and Kyo's pupil Shingo Yabuki. In total, The King of Fighters '97 sports 29 separate characters (without counting the six Orochi-related boss characters, which are all accessible via a secret code).