Officials reviewed the basket after the game not only to see if Outlaw got the shot off in time, but also whether the clock started properly when Portland inbounded the ball with 2.8 seconds left.
Outlaw took the inbounds pass near midcourt and drove the right side on Mike Miller before firing the off-balance bank shot. Outlaw scored the last seven points for the Trail Blazers over the game's final 56 seconds.
It was Outlaw's second buzzer-beater of the game as his 30-footer at the horn cut Memphis' lead to 80-78 at the end of three quarters.
Rudy Gay had 30 points, including a sweeping rebound tip with 2.8 seconds left to give Memphis the lead before Outlaw's winning basket.
Miller had a season-high 30 points for the Grizzlies.
Brandon Roy had 26 points and nine assists for Portland, which had lost its first nine road games this season. LaMarcus Aldridge finished with 23 points. Advertisement
Juan Carlos Navarro had 16 points for Memphis, while Pau Gasol added 14 points and 15 rebounds.
The game was tied at 99 with 2:08 left after Roy hit an 18-footer. But consecutive baskets by Damon Stoudamire gave Memphis a 103-99 lead with just over a minute to play.
Outlaw bounced in a 9-footer with 56 seconds left and added a 3-pointer with 15 seconds remaining to give Portland the lead before Gay's sweeping tip-in.
The Grizzlies held a seven-point lead earlier in the fourth, but seemed to run out of gas, hitting only two field goals over a 4-minute span. That allowed Portland to put together a 10-2 run, erasing Memphis' lead.
The Grizzlies led 57-50 at halftime behind 18 points from Miller and 14 from Gay, as they combined to shoot 12-of-19 in the half.
James Jones had 11 of his 16 points in the first half to lead Portland.
The Trail Blazers hit 11 of their final 17 shots in the first quarter. Meanwhile, Memphis seemed to be struggling through its offensive flow early, not handling the ball cleanly and having some shooting issues. Gasol, who had 10 points in the half, missed five of his first six shots and had two others rejected by Joel Przybilla.
James Jones, who either did not play or was inactive during a 12-game stretch earlier this season, had his second productive game, hitting his first four shots from the field and missing only one of seven shots on the night.
Memphis came out flat in the early minutes of the second half committing four turnovers in the first three minutes and missing its first three shots. But Miller got untracked and scored 10 points in the period, and Memphis built a nine-point lead.