The Lakers confirmed Thomas and Cavs forward Channing Frye were joining from Cleveland in exchange for guard Jordan Clarkson and forward Larry Nance Jr.
The Lakers will also get the Cavaliers’ protected first-round draft pick in 2018 as part of the deal.
Crucially, the trade frees up salary space for the Lakers which could enable them to pursue a blockbuster deal for James, who will enter free agency in the summer.
Lakers president Earvin “Magic” Johnson told reporters the deal was an important step on the team’s rebuilding journey.
“Hey, we had to do this deal for now and the future of the Lakers,” Johnson said.
“I came here to create flexibility for our organisation so one day we can have a superstar come here with our young core,” he added.
Thomas joined the Cavs last year as part of the move which sent Kyrie Irving to the Boston Celtics.
However the playmaker has been unable to settle in Cleveland, missing the first two months of the season with a hip injury.
On Wednesday, Thomas told reporters he did not want to leave Cleveland in what would be the fourth move of his career.
“I’m tired of being traded,” Thomas said following the Cavs’ win over Minnesota. “That’s not a good thing. But I just want to be where I’m wanted. I like it here. It hasn’t been as planned, but I definitely want to be here.
“We have a real chance to win an NBA championship, and I want to be a part of that.”
Thomas is now expected to form a partnership with rookie Lonzo Ball in the backcourt, despite the fact they both play at point guard.
“He’s a great player. He’s still coming back from injuries, so the (more time he has on the court) the better (he’ll get),” Lakers coach Luke Walton said of Thomas.
The Thomas deal deal marked a frenzied deadline day for Cleveland, who also offloaded Dwyane Wade back to the Miami Heat in exchange for a protected second round pick.
The Cavs also brought in Rodney Hood (Utah Jazz) and George Hill from the (Sacramento Kings), while sending Joe Johnson and Iman Shumpert to Sacramento.
Jae Crowder and Derrick Rose were also sent to Utah as the Cavs dramatically reshaped their roster in a bid to kick-start a season which has seen them fall away at the top of the Eastern Conference.
Whether the restructuring is enough to persuade James to remain in Cleveland however is an open question.
Cavaliers general manager Koby Altman said the arrival of Clarkson and Nance Jr. from the Lakers would “add athleticism, energy and length” to the roster.
“This trade is also a reflection of our continuing commitment to invest in our roster in ways that help us evolve and compete at the highest level now and into the future,” Altman said.
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