Steve Francis was BALLIN' OUT during his drunk driving arrest -- claiming he was wearing a $1 MILLION chain when cops took him into custody ... this according to the police report obtained by TMZ Sports.
As we previously reported, the ex-NBA star was popped for DWI in Houston on Saturday night -- and allegedly threatened revenge on the arresting officers.
He was taken to a nearby police station where he was booked -- and while there, cops noted the "property" he had on him at the time .