An overtime win over Tennessee in the SEC quarterfinals was not enough to get the Rebels into the NCAA tournament, an event for which they've not qualified since 2002.
Saturday evening CBS NCAA "bracketologist" Jerry Palm had the Rebels in his "last four in" for the big tournament, but that status changed Sunday morning.
Ole Miss was eliminated in the SEC semifinals in a 65-53 loss to eventual tournament champ Vanderbilt.
"I was not overly optimistic. We've been in that situation, unfortunately, three different times where we felt like we needed one more marquee win. The hole in our resume, when you look at it objectively, is the fact that we were 1-7 vs the (RPI) top 50. That in and of itself kept us relegated to the NIT," Rebels coach Kennedy said.
The Rebels (20-13) are a No. 2 seed in the NIT, paired with No. 1 seed Arizona in a bracket with Western flavor. If the Rebels get past Illinois State they have possible matchups with Stanford in the second round and Nevada or Arizona in a third-round game.
The fourth round would be the semifinals in New York, and it's there that Ole Miss could face rival Mississippi State if both teams advance.
For Ole Miss, it is the fifth NIT trip in six seasons under Kennedy.
The Rebels reached New York in 2010 and 2008. Last year the Rebels lost 77-74 in a first-round game at California. Ole Miss is 7-4 in NIT games under Kennedy.
Illinois State (20-13) finished third in the 10-team Missouri Valley Conference, one of five teams to finish with a 9-9 conference record.
The Redbirds finished with a 100 RPI ranking, 108 strength of schedule ranking and have top 100 RPI wins against Northern Iowa (twice) and a top 20 RPI win against Wichita State, which made the NCAA tournament field.
"Getting to the NCAA tournament is the holy grail, and when you don't reach it, there's disappointment and frustration," Kennedy said. "My hope is that once we get beyond that, once we see now that goal is gone, but there's the opportunity in front of us to keep playing basketball, that the competitive spirit that allowed these guys to get inside an SEC locker room will take over."