It’s late November, deep inside the concrete bowels of the Pepsi Center, and Denver Nuggets coach George Karl and one of his players, Dahntay Jones, are arguing.

A few weeks earlier, Karl had slapped a $500 fine on the 28-year-old guard after Jones was late to the team plane and held up the flight to Oakland. Now Jones, stripped to his shorts in the team’s dining room, is apoplectic. He thought he had a reasonable excuse: It was Election Day and he was stuck in line, waiting to cast a vote for Barack Obama.

“Five hundred, George? I thought you’d be proud! I was exercising my constitutional rights!”

It’s a surreal moment, considering Jones will make nearly $1 million this season. Perhaps even more outrageous is that the Nuggets are 8-4 at the time of this argument—in what was expected to be a mediocre season—and this verbal battle is the closest Karl has come to the insubordination that has defined his tenure with this team.

“Five hundred?” Jones barks. “That’s bullshit! You don’t think it’s good that I voted, George? Come on, that was our boy!”

For a moment, it looks like Karl—who stumped for Obama and preached all fall about the need to get out and vote—might back off. “You have a point,” he tells Jones. But if this is a come-to-Jesus sort of moment, it’s a short-lived conversion. Karl thinks little indiscretions like these are a harbinger of bad juju—karma, as the coach puts it—and Karl’s had it with the bad karma.

“You should’ve voted absentee. That’s what I did, and I wasn’t late for the plane.”

Jones shakes his head and laughs, but he’s not done.

“And another thing, George, what did you promise me at the beginning of camp?”

“What?”

“That if I gave it my all on defense, I’d get….” Jones pauses a few beats. “What?” Karl asks.

“More minutes.”

Now, the old George Karl—the guy who once booted a ball into the stands during a game; who angrily challenged a player to a game of Jeopardy! to prove who was smarter; who ripped a toupee off someone during an on-court fight—might have cut off the conversation right there. “Furious George” would have gotten in Jones’ face, maybe pushed a table over. But not this time, not this George Karl.

“You know, Dahntay, you’re right,” he says. “I haven’t kept up my end of that deal, and I need to.”

There’s another pause. “That’s OK, George, whatever,” Jones says. “And I’ll take the $500 fine.”

Jones begins walking out the door.

“Dahntay!” Karl calls. His voice drops. It is earnest and thoughtful and fatherly. “Hey, I know you’re mad, but we’ve had some problems here in the past with respect, where some things have gotten out of hand. We can’t have that happening again. It’s nothing against you.”

“That’s OK, George. I’ll pay $500 for Obama.”

These days, George Karl looks more like a guy who got off the last bus from Albuquerque than the millionaire coach whose last losing season came during the Reagan administration. The guy’s pushing two-and-a-half bills, and his gut stretches a pullover sweatshirt that falls over the waistband of his elastic gym pants. His Adidas shoes are scuffed. After two hip replacements and six knee surgeries, his walk no longer is a confident gait as much as the limp of a wounded elk searching for underbrush. He’s got a nasty dog-bite scar on his upper lip. His facial features are swollen and tired; he has a wide forehead, bushy eyebrows, and long, graying hair in the back that’s thinning everywhere else.

So it might surprise you that, of the 300-plus men who have coached in the NBA, only nine have more wins than him. This is the man who’s taken four straight Nuggets teams to the playoffs—his only seasons with the franchise—giving Karl 17 postseason appearances in 20 NBA seasons. When he showed up in Denver in the middle of the 2004-2005 season, he won 32 of his first 40 games. Last year, he brought the Nuggets their fourth 50-win season in team history. And if that weren’t enough, consider his basketball pedigree. He played point for the legendary Dean Smith at North Carolina, who played for Forrest “Phog” Allen, “the father of basketball coaching,” who played for Dr. James A. Naismith—the guy who invented the game.

Here’s the rub: Karl’s got more than 900 career wins in the NBA, but he’s never won a championship of any kind since he started coaching 31 years ago—not as an assistant, not as a head coach in the Continental Basketball Association, not in Spain, or with Cleveland, or Golden State, or Seattle, or Milwaukee, or….

In fact, none of Karl’s Nuggets teams has gotten past the first round of the playoffs. If anything, his time in Denver has been defined by spectacular postseason meltdowns—of calling out players in newspapers, of young future stars afraid to take a shot for fear of being benched.

So here’s George Karl, early this winter, sitting in a rolling chair along the far sideline of the team’s practice court inside the Pepsi Center. The lights in the second-floor gym reflect off the wooden floor, the sounds of bouncing balls and squeaking sneakers fill the cinderblock room. “If you fuck with the game, it will fuck with you,” he says as he sits in his chair. “If you mess with the game, it will embarrass you.”

After four straight first-round exits under Karl, embarrassing only begins to explain the team’s playoff performances. This season, it was clear, would prove whether Karl belonged in Denver.

Last summer, the Nuggets lost two key players—former defensive player of the year Marcus Camby, and sixth-man Eduardo Najera—to salary cutbacks. Karl had to endure those in the sports-talk echo chamber calling for team owner E. Stanley Kroenke to can his oversized keister. His ability and his heart were questioned. Where’s the fiery old George from Seattle? Why can’t he connect with his players? Has the game passed him by? A Denver Post column last April epitomized the feelings of an entire fan base: “If the billionaire owner of the Nuggets wants to pay coach George Karl for doing nothing, all we can do is watch as Denver gets rudely bumped from the NBA playoffs year after year…. Karl has not gotten it done. It’s time to give somebody else a shot.”

Even for a tough guy like Karl, the criticism stung. During the previous season, Karl felt like he was spending too much time fending off barbs. Privately, he wondered whether the front office folks were just waiting to fire him. So if Karl seemed paranoid, it was with good reason. The 2007-2008 Nuggets cost Kroenke more than $80 million but imploded when the stakes were highest. Though Karl kept his job (he’s signed through next season at $3 million per year), the offseason cost-cuts were perhaps a message from Kroenke and his staff: We don’t need to spend big-time cash if your team is only going to survive one week in the postseason.

Since coming to Denver in 2005, George Karl, who’s now 57, has privately struggled through his own nine circles of hell: prostate cancer, his son’s thyroid cancer (and its relapse), and his realization that he had given everything to basketball and hardly anything to his family.

But this offseason was different. Despite the seemingly endless second-guessing from sports columnists and fans, he finally started to feel at peace. His daughter, Kelci, gave him his first grandchild; he moved from a posh Denver neighborhood into one more akin to his blue-collar Pittsburgh roots; he had a bum hip replaced. All of these things got Karl to thinking about what he calls “soulful wisdom,” a person’s ability to recite more than just meaningless facts, a way of connecting one’s teachings to a deeper significance. “During the summer,” Karl’s agent and friend Warren LeGarie says, “George became a different man.”

At training camp this summer, Karl gathered his team and told them things were about to change. No more crap. “I’ve done it your way for three years, and it hasn’t worked,” he said. “Pretty and cool doesn’t win games. Gritty and tough does.”

Everyone on the team knew their coach knew something about gritty and tough.

To appreciate George Karl, you must first know little Georgie Karl, the kid from Pittsburgh.

It was there that a schoolyard bully beat eight-year-old Georgie pretty good. Georgie showed up crying outside his family’s razor-thin, three-story house. He had a bloody nose and a scratched face. Grandpa Patterson was standing in the doorway: You’re not comin’ inside until you settle things with that boy. Georgie sniffled back a tear. The lesson couldn’t have been more clear. Little Georgie wasn’t supposed to back down from anyone.

Georgie’s own dad, Joseph, was a ditto-machine repairman who worked while Mom stayed home and doted on Georgie and his older sister. Grandpa, a natural athlete, imparted toughness and recognized early on that there was something special in his daughter’s little boy.

While Dad knew a lick about sports, Grandpa seemed to know everything, especially when it came to basketball and baseball. He and Georgie played catch all day. Then when Dad put the first basketball hoop in the backyard, they played all night. Grandpa showed Georgie how to hold a ball for a shot—hand back, elbow up, and then flick it, so all those black lines on that ball spun backward like a pinwheel. They practiced dribbling, layups, jumpers. Soon, the little kid was a big scrapper, whipping kids at the gym. Georgie had made a name for himself as the neighborhood spitfire.

When Grandpa died in 1960, Georgie’s dad pulled his boy aside and promised that he’d do everything he could to continue Grandpa’s work. What the Old Man didn’t know about hoops, he more than made up for by working hard and leading by example. In the Karl home, honest work and toughness were beautiful gifts.

From his father, Georgie learned that talent wasn’t enough. The lessons served him well when he became George Karl, one of the country’s most highly sought high school guards. He had more than 100 colleges interested in him, but Karl settled on the University of North Carolina, where Dean Smith was his coach. At Carolina, Karl studied political science and psychology; he grew his hair long, protested the Vietnam War, and enjoyed a reputation as a burgeoning gym rat, the guy who dove for loose balls and would take charges from guys eight inches taller than him. Joseph Karl wasn’t impressed. He wanted to know that his kid was listening to his coaches, so he called Coach Smith three times a year, just to make sure his boy was earning his scholarship.

Smith rewarded Karl’s hustle. He was injured early in his freshman season and underwent back surgery, but he came back the next year and earned a starter’s spot. Karl helped win the National Invitation Tournament when he was a sophomore, then brought UNC to the Final Four of the NCAA tournament the next year.

The New York Knicks drafted Karl in the fourth round in 1973, but Karl instead went to the San Antonio Spurs in the rival American Basketball Association. “I signed my contract for $150,000 over three years, and I called my dad right after,” Karl says. “The phone goes real quiet. He says to me, ‘Do you know that’s more money than I’ve made in my lifetime?’ He was happy for me, but he was also making the point that I’d better earn every dollar of that.”

Karl would make his name as a hard-charger off the bench—the “Kamikaze Kid”—who got by on guts and courage. He once punched “Pistol” Pete Maravich during an exhibition game, then tore off a guy’s toupee in the ensuing brawl.

For five seasons Karl scrapped and fought, but a blown knee eventually limited his court time. By 26, Karl had hung up his high-tops. He held on as an assistant coach in San Antonio—where he got married and had his first daughter, Kelci—then three years later was in Montana, as head coach of the CBA’s Golden Nuggets. His son Coby was born; Karl won the league’s coach of the year award twice, and brought consistent wins to Montana, even if his team’s owner couldn’t make consistent payrolls. Before the Golden Nuggets went belly-up in 1983, Karl was paying players out of his $18,000-a-year salary. He took home $6,000 that year.

Even without a championship, Karl proved he had the chops to succeed. His big break came the next year when the NBA’s Cleveland Cavaliers asked him to be the head coach of a franchise that hadn’t been to the playoffs in seven years. The team responded to Karl and made the playoffs in 1985. By the next season, though, Karl’s schtick had worn thin: A few weeks short of the regular-season finale, Karl had only 25 wins and was fired.

A similar script played out in California soon after, when Karl led a formerly awful Golden State Warriors team to the playoffs (after losing a second-round game Karl famously ripped up a player’s locker), then saw his team fall apart the next season. Night after night, it was the Pistol Pete fight relived—meaningless battles for the sake of the fight. “When you’re young, you think anger is a teacher,” Karl says now. “But anger is a door-slammer, and you don’t know how to use it when you go into the job. You think passion for basketball means anger.”

Karl was only 36 years old; his career was falling apart, and his personal life suffered. Exiled from the NBA, the family bounced around European leagues and the CBA for the next three years. At home, family life was strained, and his relationship with his son was almost nonexistent.

The Karls moved again in 1991, this time to Seattle, where they stayed seven seasons. Karl made one trip to the finals as coach of the SuperSonics, in 1996, but lost to the Chicago Bulls in six games. Though his teams averaged 59 wins a season, Karl was dumped three years later amid ownership complaints that he hadn’t won the Big One. His wife filed for divorce a year later.

The Milwaukee Bucks snapped Karl up in 1998 and eventually gave him a $7 million-a-year deal—at the time, the richest contract given to any coach in any sport—after he led the team to its first playoff appearance in seven years. Two seasons later, he got the Bucks to within one win of the finals. Karl was King Midas all over again. Still, he found himself slipping back into the old “Furious George” caricature. He complained when Doc Rivers, a former player with no coaching experience, landed the top job in Orlando. He blasted his star players—Ray Allen, Sam Cassell, and Glenn Robinson—saying they only wanted to make “sure they get their numbers.” Every few months, faxed newspaper stories would come across Karl’s desk, with handwritten notes from Dean Smith. “Every quote where I said the word ‘I’ or ‘me’ he circled and wrote, ‘Don’t you mean ‘We?'” By then, though, it was too late. After two mediocre seasons, Karl was gone.

For the first time in his adult life, Karl was no longer in basketball. Back at home, with more time than ever on his hands, he began to take inventory of his life. His father was ill, he wasn’t married, and he hardly knew his son.

I first met with George Karl just before the regular season began, at the Pepsi Center. I waited for him inside the practice gym, where one of the Nuggets’ spokespersons approached me. “This is probably the worst day for you to talk to him,” the guy said. “Coby was just cut by the Lakers.”

It wasn’t much of a surprise. Coby Karl had played sparingly for Los Angeles: During the playoff series against his dad’s team last season, Coby logged just two minutes on the court.

The hurt in Karl’s eyes was plainly visible when we met outside the locker room awhile later and headed to his Cadillac Escalade.

Sorry to hear about Coby, I said.

“That’s OK. You know, I think dads take this stuff harder than the sons.”

We climbed into his Escalade. The radio was tuned to a sports-talk show, and it droned in the background while I tried to make small talk about his son’s possible landing spots.

Could he sign with another NBA team?

“Not right now. All the rosters are filled. He’d have to wait for an injury.”

What about overseas? Those guys make a boatload of money….

“I’m not sure about his opportunities there. I’m sure he’ll check that out.”

I was searching for questions when his son’s news was broadcast to the rest of the city: “Coby Karl, son of Nuggets coach George Karl, was cut….” It was one of those moments when everything slows down and you can see the split second of impact. Neither of us said a word.

Over lunch, Karl opened up. “Ten years ago, I didn’t know where my family life would be. I used to be that guy who’d be calling the league office during the day, just to talk to someone like Jerry West. I was completely motivated by my contacts, not by my family. Now my family’s the dominant part of my life.”

In the summer of 2000, Karl and his ex-wife bought Coby a house outside Milwaukee so he could stay in the same high school rather than be shuttled between parents. Karl lived there part of the year. In time, Coby realized that he had the same heart and talent and love for basketball that Pops had growing up. George Karl saw that his teenage boy was growing into a man, that Coby had developed into a tremendous athlete. But he didn’t know how to say it. “Coby and I were drifting apart, and I was letting it happen,” Karl says.

Three years later, after Karl lost his job in Milwaukee, Coby had already walked onto the team at Boise State University. Karl had gotten part-time work as a studio analyst for ESPN, which hardly filled his time the way an NBA schedule did, so he bought a townhouse in Idaho.

Karl played poker with Coby and his friends, covering the boys’ losses when games carried into the night. Coby and his father studied game film together. After games, Karl took his son to Chili’s and they’d split a piece of chocolate cake. “Those two years were a gift,” Karl says. Coby couldn’t believe his father had changed so dramatically. “It was something we’d never had, a regular father-son relationship,” Coby told me. “For the first time, I saw that he finally was able to detach from basketball. In all the other places he’d been, he was consumed by it, 24-7.”

When Denver came calling in early 2005, the Nuggets had gone through two coaches that season and produced only 17 wins. Still, there was reason for hope: Carmelo Anthony was coming off a season in which he finished second in Rookie of the Year voting; the team was returning the core of a young starting lineup; and in the offseason the Nuggets added New Jersey’s All-Star forward, Kenyon Martin, for whom the team traded three first-round draft picks. With their relationship on the mend, Coby told his dad it was OK to go.

As Karl got to work turning around Denver’s fortunes, Coby was killing opponents with his deft shooting. And then it all almost fell apart. A few months after arriving in town, Karl went to the doctor and learned he had prostate cancer. He had just had a baby girl, Kaci Grace, with his “life partner,” Kim Van Deraa, his former secretary in Milwaukee. It was a turning point. Karl sat his two oldest kids, Kelci and Coby, down. “I made it clear that I cheated them,” he says.

“We just sat there and listened,” Coby says. “It was good to hear him admit fault. I think that meant a lot to us.”

A few months later, Karl had surgery to remove the cancer, but that was far from his last fight. The next January, Coby went to the doctor to get a lump on his neck checked out. He had thyroid cancer.

Karl told his son that he’d quit and get to Idaho as soon as possible. “Dad took the cancer a lot harder than me, a lot harder than I ever would have expected,” Coby says. “He’d be on the phone, telling me about this doctor or that doctor, and how I was going to get the best treatment in the world.” George Karl did leave his team eventually, for three days, when Coby had surgery to remove his thyroid. He cried at his son’s bedside.

“If anything, I think the cancer strengthened his daily intention to meditate,” Kelci told me. “He’s focused more time on reflection. He’s less aggressive.”

The memories of his son’s battle, and of his own, still haunt him. “When my back hurts,” he told me, “I don’t think it’s a backache, I think it’s cancer.” Kim says George slowed his life considerably after the brush with mortality. The two recently moved from a house in the Cherry Creek Country Club to a more modest, professional neighborhood in east Denver, with ranch-style homes, lots of children, and a park. It’s hardly a neighborhood where you’d expect to find a guy making a few million a year. “George couldn’t stand the thought of living in a gated community,” Kim told me. Even Kaci Grace’s early education, a Montessori school, was selected with social development in mind. “I wanted a school that had diversity, with black kids and white kids and Asian kids,” Karl says as we drive to his daughter’s school one afternoon to set up the gymnasium for a school event. “My time overseas really got me to appreciate cultures, how people live. It enriched my life, and I want Kaci Grace to have the same experiences.”

We stop in the school parking lot and walk to the middle of a few buildings on the school’s campus. Kim’s already there, chatting with a friend. Karl looks at the ground, at a bunch of signed bricks that families donated for a school fund-raiser.

“Kim, where’s our brick?” “It’s there somewhere, George.”

Karl begins scanning each row, line by line. A few moments later, he taps my arm. “Right there,” he says.

Kaci Grace

Below his daughter’s name is an inscription Karl added. It’s his mantra, he tells me. It’s a little corny, a little sentimental, but it brings a wide smile to his face:

Life is good.

George Karl might be a different guy from the basketball-obsessed Genghis Khan who just a few years ago prowled the sidelines, but he’s still a coach unafraid to speak his mind. Four games into the Nuggets’ 2008-2009 season, the team traded aging superstar Allen Iverson for another veteran, Chauncey Billups, a Denver-born point guard who won a ring with Detroit in 2004 and is considered among the best game-managers in the league. A few weeks after the trade, Karl did an interview in which he praised Billups: “For me, it’s the efficiency of how we play,” Karl told reporters. “There’s less bad plays, more solid plays, and we still have good plays. But I think the elimination of the wasteful, cheap possessions that we have sometimes had 10 to 15 a game, they don’t exist very much anymore.” His words were perceived as a jab at Iverson’s on-court decision-making abilities, which Karl says he didn’t intend. Still, he admits that A.I. perhaps wasn’t the best fit for the team. “He’d plateaued,” Karl told me. “You don’t want to be coaching a guy in his down years. When we made the trade, we got better.”

Even if the league as a whole, in his mind, has not gotten better.

“We’ve got this ‘how-much’ syndrome in basketball,” Karl says after one practice. “Capitalism has taken over. Things have changed since I was growing up. All these guys have been coddled since the second they showed they had some talent. There’s no desire to learn the history of the NBA, or the Globetrotters, how the drug culture almost bankrupted the league. Our depth of knowledge today is so shallow.”

When Karl talks capitalism, it’s not in the ironic, guy’s-made-50-million-bucks-in-his-career sort of way. Instead, it’s his Marxist instinct about the game. Every NBA team is stacked with guys who were the best players to come out of their towns, McDonald’s High School All-Americans who signed million-dollar shoe contracts before they could legally pop Cristal at the club. But the best teams—the Lakers of the 1980s, the Spurs of the 2000s—have players who share their talent with their teammates, who know their place as a cog that will advance the game for generations of other kids.

“Honestly,” he says, pointing to his players on the practice court, “I doubt if any of them know who Bill Russell is.”

It’s an overstatement, to be sure, but Karl’s frustration with his team seemed to hit an apex in the offseason, when he rounded up his players and announced the team’s new direction. “Sometimes George is criticized,” Nuggets forward Kenyon Martin told me in January, “but we put him in that position a lot. I think we all decided we had to do a better job and get fans off his back.”

Karl himself has asked Anthony, the team’s best player, to raise his game on, and off, the court. There was the infamous “Stop Snitchin'” video shot in his home town of Baltimore, then the 2006 brawl in New York that brought a 15-game suspension, then a DUI arrest last year that Karl called “very de-energizing” for the team. “This season, we’re walking him to the gritty, tough side of basketball,” Karl says of his 24-year-old All-Star. “He respects that he has to make changes to his game. Sometimes there’s a fight there, but that’s no different than any other player. We all feel miserable for losing [multiple playoff matchups], and we want to change that. It’s a lot easier when your best player leads.”

Anthony’s progression, however, is hardly Karl’s most pressing issue. His biggest project is the 23-year-old J.R. Smith, an immensely talented guard who has been a pebble in Karl’s sneaker ever since he arrived in a trade three years ago.

A few weeks after this season began, Smith showed up late for practice, put on his jersey backward, then half-assed his way through a workout. Afterward Karl did some interviews, then headed into a bunkerlike broadcast room, where he would tape a PSA on shaken-baby syndrome. Karl sat down and did a mic check.

“Ten, nine, eight, seven, six, five, four, is J.R. Smith ready to start? I think we have the answer to that one.”

Like so many high school stars who skipped college after Kevin Garnett and Kobe Bryant hit the jackpot in the 1990s, Smith was one of the young, highly touted players who went from high school prom to NBA millionaire overnight. Although his ability is unquestioned, Smith burned through goodwill quickly during his first NBA stop in New Orleans in 2004, then came to Denver—where he was quick to shoot and slow to learn—and his lackluster play culminated with a benching during the 2007 playoffs. Months after watching his team get bounced in four against San Antonio, Smith was involved in a New Jersey car crash that killed a friend (a grand jury declined to indict him on vehicular homicide charges), then got two speeding tickets and had his license suspended three times. A few months after the crash, he poured Champagne on a woman at a nightclub, spit on her, shoved her, and tore her dress. But Smith’s head almost hits the rim when he dunks, and when he’s hot he can drain three-pointers from anywhere on the court. Last summer, the Nuggets inked him to a three-year, $15 million contract.

After Karl’s taping (“Please, please, pretty please, don’t ever shake a baby”), I ask about his attitude toward Smith.

“I’ve been to personality clinics where they say that you have to come up with four positive things for every negative,” Karl says. “But I’m not someone who is going to overanalyze what they don’t have. If there’s a void…love, whatever, I’ve got my assistants mentoring him. Look, J.R., he’s got great parents, but it’s like he has ADD. There’s laziness, a lack of focus on a daily basis. In the NBA, everyone has talent. The game isn’t about talent, it’s about team.”

And maybe, out of everything that is different about George Karl this season, this is one part he does not wish to change. Sure, he might be more mellow now, more comfortable with the life he’s created for himself. But maybe he refuses to believe that there isn’t a place for a guy who played the game like he once did—that grit and toughness should be enough to keep a spot on the team. Maybe that’s why he was so disappointed when Coby was released—a cancer survivor with a sweet jumper who did whatever his coach asked of him, even if that meant parking his butt on the bench for 48 minutes a night and supporting his teammates. Maybe, because of that, he wants to instill a bit of the working-class Pittsburgh roots in all of his players, even if they don’t want it.

Back at home a few hours later, Kaci Grace is stretched on her mother, watching Barney on a laptop. Karl is still fuming about his day. “I’m going to dream that J.R. shows up late for practice tomorrow, just so I can lock the door and not let him in. And then he’s not going on our next road trip.”

The next day, however, Smith arrives on time. He travels with the team to Los Angeles, but Karl benches him in a win against the Clippers. As of late January, coach and player had yet to discuss the decision, which the talking heads had mostly blamed on Karl’s stubbornness.

But like Karl’s career, there’s a twist. What the beat writers and columnists and sports-radio bloviators and bloggers and fans don’t know, or conveniently overlook, is the fact that maybe Karl wants Smith to succeed. Maybe, deep down, the coach thinks he can change his player’s life, just as he’s continually trying to change his own.

You see, Karl learned that J.R. Smith wants to make his parents proud, that he has plans to someday attend college during the off-season. First, he needs to find a school. His first choice is the University of North Carolina.

George Karl has already put in a call. Who knows? Maybe someday in the not-too-distant future, coach and player might finally have a reason to talk.