Shawn Michaels' behavior at the height of his fame was "polarizing and volatile", as per a WWE Hall of Famer and current AEW employee. AEW commentator Jim Ross recently spoke about Shawn Michaels and his decision to relinquish the WWF World Heavyweight Championship rather than lose to his arch-rival Bret Hart at WrestleMania 13.
Shawn Michaels and Bret Hart had an on-screen rivalry as well as real-life hatred against each other backstage in WWE. Michaels thought of retiring in early 1997, claiming that he lost his smile.
While speaking on his Grilling JR podcast, Jim Ross stated that he didn't feel that Michaels was hurt, and said that Shawn Michaels' 'feelings were hurt':
"He was volatile. He was polarizing and volatile so anything you heard about Shawn, it was not going to be a total shock. You kind of got used to it. But, surrendering the title, I don’t know if he lost his smile because he was injured or lost his smile because he couldn’t handle the pressure. He was influenced by outside sources that liked to poke gas on his fire. I don’t know…So once you get the message of what’s going to happen in the production meeting that morning, it was like, geez, that’s pretty extreme. Maybe you give him the benefit of the doubt. Maybe something is really wrong. We didn’t know. But I always thought his feelings were hurt more than his knee or his back or whatever, and I don’t know exactly why. He had a hard time handling and accepting the responsibility of being the top guy in the territory," said Jim Ross. (H/T ITR Wrestling)
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When Shawn Michaels made the speech, he told the surprised fans at the venue that he had suffered an injury which was the reason why he had to drop the title.
Shawn Michaels in WWE in 1997
After Shawn Michaels vacated the title, his nemesis Bret Hart won the title, before quickly losing it to Sycho Sid. The Undertaker then briefly held it, before Hart regained it. At Survivor Series, Shawn Michaels controversially won the title after "defeating" Bret Hart, in what is dubbed the Montral Screwjob.
In 1997, D-Generation X was formed by Shawn Michaels and Triple H, and Michaels ended the year in possession of the world title, while dropping the European title to The Game.