Williams started her 2017 season by participating in the WTA Auckland Open for the first time in her career. She defeated Pauline Parmentier to win her first match since the US Open. In the second round, she lost to Madison Brengle. At the Australian Open, she beat former and present top 10 players Belinda Bencic, Lucie Šafářová, Johanna Konta among others to reach her 8th Australian Open final. On January 28, 2017, she won the Australian Open for an Open Era record seventh time, defeating her sister, Venus. It was her 23rd Grand Slam singles title, surpassing Steffi Graf's Open Era record of 22. It was the first time in the Open Era that two players aged 35 or older had competed in the final of a Grand Slam tournament. The win ensured her return to the No. 1 ranking. Williams subsequently withdrew from the Indian Wells and Miami Opens, citing a knee injury.

On April 19, 2017, Williams revealed that she was 20 weeks pregnant and would miss the remainder of the season. The timing of her announcement led to the conclusion that she would have been roughly eight to nine weeks pregnant when she won the Australian Open. In interviews, she maintained that she intended to return to tennis after her pregnancy, saying that she had an "outrageous plan" of competing in the 2018 Australian Open.

On September 1, 2017, Williams gave birth to a daughter named Alexis Olympia Ohanian Jr. She had a cesarean-section delivery due to a pulmonary embolism during labor.

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