Every March, while fans are obsessing over their brackets, college athletic directors are glued to a different kind of scoreboard, one that tracks NCAA Tournament Units.

In 2024, March Madness added $900 million to the NCAA’s annual revenue, which amounted to $1.38 billion. That figure is expected to have soared by this year because of the growing popularity of college athletics.

What Are NCAA Tournament Units in March Madness?

The NCAA doesn’t retain all the generated revenue for itself and distributes it among the member conferences based on a unit system.

The NCAA Tournament Units are a complex system through which the NCAA rewards member conferences whose teams do well during March Madness. Each game a college program plays in March Madness earns it ‘units’ for the conference it plays in during the regular season.

Starting this year, the Final Four and the National Championship matches will also help conferences earn units.

How Much Is an NCAA Tournament Unit Worth?

The value of an NCAA Tournament Unit has grown significantly. With the total payout pool jumping from $220 million in 2025, when a single unit was worth about $2 million, to a projected $270 million this year, according to Sports Business Journal.

How Are NCAA Tournament Units Earned?

Teams and member conferences earn NCAA Tournament Units based on their performance during March Madness. Basically, the further a team reaches in the NCAA Tournament, the more units its conference will earn for that March Madness. There are a total of 135 units up for grabs, including First Four, Final Four, and National Championship games.

Conferences earn a base unit for each team that receives an automatic or at-large bid. From there, additional units are awarded for each tournament game played through the Final Four, and starting this year, new rules provide even more value for teams that reach the National Championship game and win the title.

How Is March Madness Revenue Distributed Among Conferences?

Conferences start receiving unit payouts the next year, with the total payout spread out over six years. The conferences decide how to distribute revenue among their participating teams, with some opting for equal distribution while others also add performance-related bonuses.

In 2025, each team earned approximately $350,000 per year over the six-year period, which can be a significant sum for small, underfunded programs. This payout makes Cinderella stories even more significant in the grand scheme.

Do Teams Get the Money Directly From NCAA Units?

The NCAA doesn’t pay the teams directly. The unit payout is allocated to member conferences, which determine the distribution method.

Since major conferences like the Big 12 and the SEC boast several teams in the NCAA Tournament, they end up earning more than the smaller conferences. The MAC will benefit this year, with two teams making it to the National Tournament.

What Happens to Units Over Time?

A conference’s annual payout is based on the sum of all still-pending units earned. Once a conference receives revenue for the sixth year of the units earned, those units are no longer counted.

Teams that leave a conference still earn from the distributed revenue for the year they were part of that conference. And conferences retain the units earned even if teams end up switching to another conference.

Do Women’s NCAA Tournament Units Work the Same Way?

Women’s NCAA Tournament Units are paid out over three years instead of the six years for men. Each unit in women’s March Madness amounted to around $113,000 in 2025, with the total payout coming to $15 million. This year, the payout is expected to reach $20 million.