The 1985–86 Indiana Hoosiers men's basketball team represented Indiana University. Their head coach was Bobby Knight, who was in his 15th year. The team played its home games in Assembly Hall in Bloomington, Indiana, and was a member of the Big Ten Conference. The Hoosiers finished the regular season with an overall record of 21-8 and a conference record of 13-5, finishing 2nd in the Big Ten Conference. IU was invited to participate in the 1986 NCAA Tournament as a 3-seed; however, IU made a quick exit with a first-round loss to 14-seed Cleveland State.