Following the 1992–93 NBA season, Schrempf was traded to the Seattle SuperSonics for forwards Derrick McKey and Gerald Paddio. He ranked second in the NBA in three-point accuracy during the 1994–95 season with a 51.4 three-point field goal percentage and became leader in the NBA in offensive rating the same season with 127 points per 100 possessions. On a Sonics team that also featured Gary Payton, Shawn Kemp, Sam Perkins, and Hersey Hawkins, Schrempf reached the NBA Finals in 1996, where they lost to Michael Jordan's Chicago Bulls in six games. Schrempf became the first (and one of only two, to date, along with Dirk Nowitzki) German-born NBA player to reach the NBA Finals. While with the Sonics, Schrempf played in the NBA All-Star game in both 1995 and 1997.
Schrempf established the Detlef Schrempf Foundation in 1996 to benefit local charities. In January 2012, he won the Paul Allen Award for Citizenship (formerly the Seattle Sports Commission Sports Citizen of the Year) at the 77th annual Sports Star of the Year banquet in Seattle. His foundation hosts the Detlef Schrempf Celebrity Golf Classic at McCormick Woods Golf Course in Port Orchard, Washington, each summer and has raised about $10 million for children's charities in the Pacific Northwest.