• The Los Angeles Chargers moved to San Diego, but otherwise the eight-team league stayed intact thanks in no small measure to the five-year television contract with ABC.
• The Oakland Raiders continued to struggle, playing their home games at drafty Candlestick Park in San Francisco and finishing 2-12, one game worse than the Denver Broncos.
• The league lost nearly $2M during the season, but most club owners figured the worst was over since they had lost about twice that much in 1960. Commissioner Joe Foss reported that three clubs - Boston, Buffalo, and Houston - would break even or even wind up in the black.

The Houston Oilers defended their East Division crown, although not without turmoil.

• When the club started 1-3-1, owner Bud Adams fired head coach Lou Rymkus and replaced him with Wally Lemm.
• Lemm had been an assistant on the '60 Oilers staff but had resigned after the season to work in the sporting goods industry. Houston Director of Player Personnel John Breen, who had coached Wally at Carroll College (WI), offered him the top job.
  According to Ken Rappoport, Rymkus and Lemm could not have been more different. Rymkus was gruff, worked his players to exhaustion at times, and had tunnel vision: football pretty much was his entire life. ... He also was the hardest worker on any coaching staff, just as he was the most diligent player on every team for which he played. And if the workload, including the scrimmages, bothered teammates or the men he coached, well, tough. ...
  Lemm had many outside interests, was soft spoken, and recognized the need for football to be fun. "Pro football players, like anybody else, do their jobs better when they like their work," he said.
• Benching Jacky Lee in favor of George Blanda, who had led the Oilers to the 1960 AFL title, the new coach proceeded to lead the Oilers to nine straight victories and earn AFL Coach of the Year Honors.
• Behind Blanda and HB Billy Cannon (the fastest guard who ever played in the backfield according to Bud Shrake of the Dallas Morning News), the Oilers led the league with 513 points, 100 more than the next team, the Patriots. Their passing total of 4,392y was over 1,500y more than second-place San Diego. Houston wasn't shabby on the ground either, finishing second in the league to the Dallas Texans.
• The Oilers also surrendered the second-fewest points in the league, 242.
  The 35-year-old Blanda was rewarded for his efforts with a new two-year contract, which he agreed to sign after the championship game.

The Western Division also had a repeat champion.

• GM/Head coach Sid Gillman's Chargers amassed the best record in the league, 12-2, in their new home at Balboa Stadium. They won their first eleven games to clinch the Western Division before losing two of the last three.
• Like Houston, San Diego returned the core of their 1960 team led by QB Jack Kemp (2,686y passing), HB Paul Lowe (767 rushing yards), and FL Dave Kocourek (55 receptions for 1,055y). SE Don Norton snagged 47 balls for another 816y.
• Although Gillman was known for his innovative passing game, his defense was the stingiest in the AFL. Opponents scored just 219 points against the Chargers, an average of only 15.6 per game in an offensive-minded league. Pro Bowlers Earl Faison and Bill Hudson anchored the Front Four that enabled the secondary to grab 49 interceptions, 16 more than second-place Houston in that department. The 49 interceptions and nine returns for touchdowns set pro football records that still stand to this day (2015).
  Gillman expressed his offensive philosophy this way: The big play comes with the pass. God bless those runners because they get you the first down, give you ball control, and keep your defense off the field. But if you want to ring the cash register, you have to pass.
  Bill Walsh, architect of the "West Coast Offense," later said this about Sid: He was so far ahead of his time, people couldn't totally understand what he was doing. He was one of the great offensive minds in football history. There's a lineage between Sid Gillman and what you see on the field today.

Chargers defense L-R: Ron Nery, Chuck Allen, Ernie Ladd, Bill Hudson, Bob Zeman, Earl Faison

The AFL followed the NFL's policy of alternating the championship game between the East and West Division winners. So San Diego hosted the '61 title game on Christmas Eve, a Sunday.

• Jack Murphy, the sports editor of The San Diego Union (for whom the new baseball/football stadium would be named), summarized the teams' two meetings like this:
  When the Chargers were able to deposit George Blanda on the back of his lap, they intercepted four Houston passes in the first half and stormed to a 34-24 triumph (September 24 in San Diego).
  When they couldn't touch him - when he was immune to assault - Houston's old pro riddled the Chargers for 351 yards and four touchdowns. The Oilers not only evened the score but did it by the startling margin of 33-13 (December 3 in Houston).
• Chargers fans wondered how their team would respond after their shocking 41-0 lambasting at the hands of the Boston Patriots in the final league game the previous Sunday. Gillman explained his team's collapse by saying they were "not interested." Did the Chargers peak too soon?
• The Oilers, on the other hand, had to fight to the end to outlast the Patriots by one game in the East. Would that give them momentum heading into the championship tilt?

Murphy expressed concern about San Diegans interest in the game since 5,000 tickets priced at $3 and $5 remained unsold the day before the game.

• Balboa Stadium had been expanded to 34,000 for the Chargers.
• The ABC telecast was blacked out in the San Diego area according to league policy whether the game was a sellout or not.
• Jack Buck did the play-by-play with George Ratterman as the color commentator and Bob Neal on the sidelines.

• Gillman had to make one move to shore up his offensive line. He activated G Gene Selawsky in place of Sam DeLuca whose ankle, injured two weeks earlier, was still not sound enought to support him properly.
• Sid promised "a few surprises" in his offense, which sputtered badly in Houston December 3. He also promised to pay more attention WR Charlie Hennigan, who caught three scoring passes in the loss in Houston. We'll have to double-team him, but it isn't that simple. They also have Groman, who was the No. 6 pass catcher in the league and didn't even play against us. And they have Cannon, who caught the touchdown pass that broke our backs last year. We've decided there is only one thing to do. We will have to rush our linebackers. When Blanda has time to throw, he connects. ... What we want him to do is get rid of the ball sooner than he wants to and with some loft on it.
  Rookie DT Ernie Ladd, a mountain of a man at 6'9" 290 lb (some said that was shy by 20lb), admitted he had been carrying a picture in his pocket since December 3 but not one of any kinfolk. It was a picture of George Blanda. Ernie wanted to be sure he recognized him when they met in the championship game. Ladd and his associates in the Chargers defensive line, including another standout rookie, Earl Faison, had little success rushing Blanda in the 33-13 loss in Houston.
  Ladd skipped two days of practice during the week because of injuries. Gillman said Ernie would not start but was expected to play.
• When the Oilers arrived Saturday, Lemm pronounced his men ready to go. I look for a lot more from San Diego than it has been showing the last three weeks. In viewing the films, I've noticed San Diego hasn't done much in the way of innovations or variety. I expect they will tomorrow. We'll just have to adjust as the games goes along."
• Houston's only injured players, LB Mike Dukes and K Claude King, had participated in the drills all week.
• Some oddsmakers established the Oilers as 3-point favorites while others had them up by more than a touchdown. Other coaches in the league agreed with that assessment.
  Hank Stram, Dallas Texans: Houston has balance, almost as good a defense as San Diego and a much better offense.
  Sammy Baugh, New York Titans: Houston has the momentum, and that's what counts this time of year. The last two months, Houston was the soundest club in the league.
  Buster Ramsey, Buffalo Bills: Houston is more explosive and has a better running game.

• Quarter 1
  Houston controlled the ball most of the half but had little to show for it. On their first possession, the Oilers ran 11 plays from their 20 to the SD 46. But the drive died when Cannon was dropped for a 3y loss and Blanda threw a couple of incompletions.
  An ugly incident occurred during the opening period. Al Jamison, the Oilers' all-league offensive tackle, smashed into All-Pro CB Dick Harris downfield after the whistle, but no flag was thrown. San Diego assistant coach Chuck Noll came on the field, shouting in protest to no avail.
  Harris was the Chargers' designated "clown," a fun-loving guy off the field who didn't joke around on the field. Unable to play the second half, he was in tears after the game. The play was over, and I had turned to go back to the huddle when Jamison hit me from the blind side. It was awful sitting there on the bench while our guys were playing their hearts out.
  Afterwards, Jamison denied any intention to hurt the opponent, saying the hit was just part of the game. He added, I hope Dick is all right. It was just one of those things.
  Blanda picked on Harris's replacement, Bud Whitehead, on the next play, but the move backfired. The rookie picked off the toss and raced down the boundary 41y to the SD 48. On the first snap, Kemp found E Dave Kocourek on a reverse-screen pattern, and the tall wingman sped between a couple of defenders to the 14. A play later, however, Fred Glick pirated Kemp's jump pass intended for Luther Hayes in the end zone.
  Jack gave the visitors another chance shortly thereafter when he bobbled the ball away to George Shirkey on the SD 37. It was one of two fumbled snaps from C Don Rogers, who hadn't played in three weeks because of injuries. But the Oilers again couldn't take advantage of the break.
  Kemp's second fumble was recovered by Doug Cline on the SD 24. After three plays netted just 4y, the Oilers lined up for a field goal attempt. However, holder Groman muffed the snap, resulting in a 27y loss.
  Given good field position on the Oilers end of the gridiron, the Chargers couldn't get close enough for a field goal attempt.
  Houston's defensive strategy was to blitz Kemp with their linebackers as well as their ends and tackles so that he would keep both backs in to block. They varied their tactics but kept Kemp running for his life. Quite often, he had to eat the ball or get rid of it before he could get set and spot an open receiver.
  Coach Lemm copied the successful strategy his friend Mike Holovak, coach of the Patriots, employed the previous week in the 41-0 rout of the Chargers.
  The Chargers also couldn't get a break. Several times they missed a first down by inches while the Oilers made theirs by the same margin.
  End of first quarter: Houston 0 San Diego 0
  

Blanda passes.

• Quarter 2
  San Diego repelled another thrust when S Charlie McNeil intercepted a Blanda pass in the end zone.
  The Chargers' chances of victory took a hit when star HB Paul Lowe was hurt during the first half and never returned to the field.
  A shanked punt by Paul Maguire that traveled only 9y gave Houston the ball on the Chargers 39. Paul made a leaping catch of the pass from center and rushed his boot. The Oilers went nowhere, but Blanda toed a 46y field goal to break the scoring ice. Oilers 3 Chargers 0 (6:54 remaining)
  Oilers WR Charlie Hennigan, who caught 10 passes for 214y and three touchdowns in the matchup in Houston, went out with an injury during the period. Their secondary was playing us a lot looser this time. It might have been different if Bill (Groman) and I hadn't both gotten hurt. I got knocked out in the second quarter, and I didn't come to until halftime. I was in the dressing room and didn't know how I'd gotten there.
  Halftime score: Houston 3 San Diego 0

Claude Gibson comes up to tackle Billy Cannon as Rich Michael tries to block.

• Quarter 3
  Lowe came out in street clothes, favoring a sore shoulder, neck, and ribs.
  Starting from their 20, the Oilers took nine plays to score what turned out to be the game's only touchdown. A 15y penalty greatly aided the advance. Finally, from the SD 35, Blanda skipped to his right and threw back to his left to Cannon, who gathered in the ball coming across the middle on the 17. Aided by a timely block on the only nearby defender, the Heisman Trophy winner trotted the remaining yards into the end zone. Oilers 10 Chargers 0
  
  Lamm: We were lucky to score our touchdown. Blanda was supposed to throw to another receiver, but he was rushed so hard, he threw to Cannon.
  
  Charlie Tolar sets sail as Bob Laraba (53) chases.
  McNeil's second interception on the SD 31, his 16y return, and a 15y assessment against Jamison (a makeup call after his earlier foul?) to the Oiler 38 started the Chargers on the way to their only points.
  Soon San Diego had a first down on the 10. Bo Robertson, who replaced Lowe at halfback, cut the distance to the goal in half on the next snap. But Kemp overthrew Bo on 3rd down.
  Bo Robertson, a graduate of Cornell, is the only person ever to earn an Ivy League degree, an Olympic medal, and a doctorate while having an NFL career as well.
  
  Kemp passes from his end zone as Don Floyd closes in.

• Quarter 4
  On 4th down, George Blair booted a 12y field goal in the first minute. Oilers 10 Chargers 3
  DT Ernie Ladd was injured when he took a blindside block while covering a Houston screen pass. He was replaced by Hank Schmidt, who had started at defensive tackle because Ernie had missed several practices during the week.
  The officials infuriated the Chargers again when DB Bob Zeman intercepted a Blanda pass while falling into the end zone, and the ball was placed on the one instead of the 20.
  My momentum carried me into the end zone, said Zeman, hotly. It was a ridiculous call.
  Fans booed when, on fourth down at the 4:23 mark, the Chargers decided to punt from their 46.
  Line coach Joe Madro: We had confidence in our defense to get ball back, and we did it. It would have been a calculated risk to go for the first down.
  Exactly two minutes later, the Chargers took over on their 37. Kemp, scrambling, found Charlie Flowers for 8y. Robertson helped with a 5y advance. Then San Diego profited from an interference ruling on Kocourek on the Oiler 37 with 1:37 on the clock. Kemp's next aerial sailed true to Kocourek on the 30, but he bobbled it just enough for the smallest player on the field, 158-lb Julian Spence, to rush in and pick it off for the interception that iced the game.
  
  Sid Gillman (black suit) and several assistants berate back judge Johnny Morrow.
  Right after the final whistle, Gillman engaged in a shouting match with back judge Johnny Morrow that resulted in Morrow grabbing the coach by the lapels and shaking him. DB Bob Zeman intervened and grabbed Morrow. I took hold of the official because he was roughing up Coach Gillman, explained Zeman in the dressing room. The fellow had made enough mistakes during the game without bothering us after it was over.
  The Chargers incurred 106y in penalties. The worst officiating I've seen all season, no doubt about it, said Gillman bitterly.
  DB Charlie McNeil: That one fellow (Morrow) was responsible for 90 percent of the bad calls. He was terrible.
  FB Charlie Flowers: The officials panicked. They acted like men in a trance. I thought they lost control of the game.

The Outstanding Player Award went to the same player as in 1960.

• Cannon gained 48y on 15 rushing attempts and another 53 on five receptions.
• With 18-for-40 for 160y, Blanda might have been considered for the honor except for throwing five picks.
• Kemp finished 17-for-32 for 226y but with four interceptions.

Final statistics:

• First downs: Oilers 18 Chargers 15
• Yards rushing: Oilers 33-96 Chargers 20-79
• Passing: Oilers 41-18-6/160 Chargers 32-17-4/226
• Return yardage: Oilers 1-7 Chargers 7-126
• Fumbles-Lost: Oilers 5-1 Chargers 2-2
• Penalties: Oilers 5-68 Chargers 10-106
• Punting average: Oilers 4-41.5 Chargers 6-33.3

The gross receipts allowed players to take home more than in 1961.

• Each Oiler made $1,724.87.
• $1,069.67 went to each Charger.

Houston Locker Room

• Lamm: We planned to go into deep coverage later (in the game), but our rushes worked so well we couldn't afford to change.
• Cannon appeared to be on the verge of exhaustion. They really battled us. I've never been hit so hard in all my life.
• Blanda sang the same tune, calling it the roughest game I've ever played in. Anytime you beat the Chargers in San Diego, you've really done a job. I thought we should have scored more. I had receivers in the open several times but couldn't hit 'em. The former Bear thought the Oilers could hold their own in the NFL. I'm not saying we could beat the Giants or Packers, but we could be right up there.
• MLB Dennit Morris gave a candid description of the opponent that his coaches probably wished he hadn't. The Charger offense isn't diversified enough. You can figure out what they're going to do on almost every play. They line up in the standard pro offense. They never use double and triple flankers the way we do.We were able to rush Jack Kemp and keep Paul Lowe from running wide because we knew pretty well what was coming every time. The Chargers have wonderful offensive personnel. Lowe is a dangerous runner, but he can't catch a pass. So that gives them only one deep threat, Don Norton. Dave Kocourek is a great pass catcher, but he isn't fast like our guys Charlie Hennigan and Bill Groman. If Kocourek had that kind of speed, he would have scored a couple of touchdowns today. The thing that hurts the Chargers is that they've got a couple of guys in the offensive line who are real lambie pies. I knew the Chargers would give us a battle. But, frankly, I thought we would win by a larger score than we did.
• Jamison praised one member of the Chargers' Front Four and dismissed another. Ron Nery is as good as any end in the league, but I would be happy to play against Ladd every day. He's just another tackle.

San Diego Locker Room

• Gillman: We stayed with them but made too many mistakes against a fine ball club. Wally Lemm did a great job with Houston, and I want to congratulate him. As for our own team, I'm proud of them. Their defense didn't give us much time to throw, and that fullback of theirs, Charles Tolar, is a fine runner.
• Line coach Madro pointed at his center as a trainer was cutting him out of his tape. Rogers there is typical. He hasn't been out (on the field) in three weeks because of injuries, but he came out today to play. They were shooting linebackers on us all day. We just couldn't keep them out. And one reason is because our offensive linemen and backs were hurt, and we just couldn't pick them up long enough to give Kemp enough time to throw.
• Kemp: We've had trouble with stunting linebackers all year. They just carried it to us.
• Defensive coach Jack Faulkner: It was one of our best defensive games of the season. Didn't we pick off six passes? We intercept six passes and still get beat. It just doesn't figure.... It was an exciting game, and I guarantee you we'd have won it in overtime if we'd scored just one touchdown. ...
• Faison: We forced them a lot harder than we did at Houston a couple of weeks ago. But we couldn't get that touchdown. We'd have won in overtime because we wanted it awful badly, and we weren't tired. Everybody put out 100 per cent.