Following his professional hockey career, Nelson moved into coaching. He was first the
assistant coach/player coach for the
Muskegon Fury of the
UHL for the 2001–02 season. He was then an
assistant coach for the
Grand Rapids Griffins of the
AHL for the 2002–03 season before returning as
head coach of the Muskegon Fury from 2003 to 2006. The Fury won the
Colonial Cup his first two years as their coach. He moved on to be the
assistant coach for the
Chicago Wolves of the AHL from 2006 to 2008, who won the
Calder Cup in his final season as an assistant. On July 25, 2008, he accepted an assistant coaching position with the
Atlanta Thrashers of the NHL. On July 15, 2010, he was introduced as the first head coach of the AHL's
Oklahoma City Barons, affiliate of the NHL's
Edmonton Oilers. After the firing of
Dallas Eakins on December 15, 2014, Nelson was promoted to head coach of the Oilers on an interim basis for the remainder of the
2014–15 NHL season. He was replaced as head coach by
Todd McLellan on May 19, 2015. On June 16, 2015, Nelson was named the head coach of the
Grand Rapids Griffins of the
American Hockey League (AHL). Nelson became the third person ever to win the Calder Cup as a player (
1994), assistant coach (
2008), and head coach (
2017), joining
Bob Woods and
Mike Stothers. On May 31, 2018, Nelson left the Griffins to become an assistant coach with the
Dallas Stars in the NHL until his contract wasn't renewed on May 20, 2022. On August 11, 2022, Nelson was named the head coach of the Hershey Bears. He is the 28th head coach in team history. On June 21st, 2023, Nelson coached the Hershey Bears to their 12th Calder Cup Championship in his first season as the head coach, beating the Coachella Valley Firebirds in overtime in game seven. On June 24, 2024, Nelson coached the Bears to their 13th Calder Cup Championship in his second season as the head coach, beating Coachella Valley in overtime again. This series was decided in game six. On June 20, 2025, Nelson was promoted to assistant coach for the
Pittsburgh Penguins. ==Personal life==