1940 was the fifth of six seasons for the American Association. In 1946 the league would change its name to the American Football League. There were more changes in 1940. Brooklyn, Danbury, and Union City dropped out in the offseason; the Long Island Indians join the league for the 1940 season… and was promptly raided by members of the new American Football League and lost four starters. The rest of the American Association was similarly hurt by defections to the new league (the Boston Shamrocks, champions of the AFL in both 1940 and 1941, got the bulk of its roster by raiding the Indians and the Steamroller). Back to only six teams, the AA instituted a Shaughnessy playoff
system, with the fourth place team facing the first place team and the second and third place teams meeting in semifinal matches, with the winners facing each other in a championship game. On the field, it was an incredibly competitive season, as only the Providence Steamroller (2-8-0) would have a losing record. The other five teams would all win five or six games. Standings include two forfeits by Providence. Providence dropped out of the league November 12, 1940, but was expected to return for the 1941 season. Newark and Long Island tied for the last playoff spot. The two teams played to a 0-0 tie on December 1, 1940. A rematch scheduled for December 5 was
cancelled due to snow; the league broke the tie with a best three-of-five coin toss, which Newark won to enter the playoffs. In the first round of the playoffs,it was Jersey City over Newark 7-6, while Wilmington would get by Paterson 11-8, to set up the match-up for the 1940 AA Championship Game. The Jersey City Giants would go on the defeat the Wilmington Clippers 17-7 to lay hold of the 1940 American Association Championship.