O'Sullivan began the 2016–17 season late, at the Shanghai Masters. In the first round, he defeated Liang Wenbo 5–4 after recovering from 1–4 down. It was his first professional tournament match in five months. However, this was as far as he progressed, as in the second round he lost by 2–5 to Michael Holt. Competing in the inaugural European Masters, O'Sullivan defeated David Gilbert 4–1 in the first round, Mark Allen 4–2 in the second round, Mark Davis 4–1 in the quarter-finals and then whitewashed Neil Robertson 6–0 in the semi-final. Facing Judd Trump in the final, O'Sullivan took a 5–3 lead after the first session. In the second session, O'Sullivan further led 8–6 before eventually losing 8–9. In the first of the Home Nations series of tournaments, at the inaugural English Open, O'Sullivan defeated Jimmy Robertson 4–0 in the first round, Zhao Xintong 4–3 in the second, but then lost to Chris Wakelin in the third by 3–4. At the International Championship, O'Sullivan beat Xiao Guodong 6–4 in the first round and Kurt Maflin 6–4 in the second to reach the last 16. However, he was then defeated by Michael Holt 4–6, making this the third consecutive loss to Holt in 2016.