<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0306</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2016-03-17</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0001022652</issuerCik>
        <issuerName>NOVATEL WIRELESS INC</issuerName>
        <issuerTradingSymbol>MIFI</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001663139</rptOwnerCik>
            <rptOwnerName>Continental Insurance Group, Ltd.</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>505 HUNTMAR PARK DR., SUITE 325</rptOwnerStreet1>
            <rptOwnerStreet2></rptOwnerStreet2>
            <rptOwnerCity>HERNDON</rptOwnerCity>
            <rptOwnerState>VA</rptOwnerState>
            <rptOwnerZipCode>20170</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>1</isTenPercentOwner>
            <isOther>1</isOther>
            <officerTitle></officerTitle>
            <otherText>Member of 10% group</otherText>
        </reportingOwnerRelationship>
    </reportingOwner>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001663143</rptOwnerCik>
            <rptOwnerName>Continental Insurance, Inc.</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>505 HUNTMAR PARK DR., SUITE 325</rptOwnerStreet1>
            <rptOwnerStreet2></rptOwnerStreet2>
            <rptOwnerCity>HERNDON</rptOwnerCity>
            <rptOwnerState>VA</rptOwnerState>
            <rptOwnerZipCode>20170</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>0</isOfficer>
            <isTenPercentOwner>1</isTenPercentOwner>
            <isOther>0</isOther>
            <officerTitle></officerTitle>
            <otherText></otherText>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common Stock</value>
                <footnoteId id="F1"/>
            </securityTitle>
            <transactionDate>
                <value>2016-03-17</value>
            </transactionDate>
            <deemedExecutionDate></deemedExecutionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>P</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>3709094</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>1.59</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>11473799</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>I</value>
                </directOrIndirectOwnership>
                <natureOfOwnership>
                    <value>By Continental General Insurance Company and United Teacher Associates Insurance Company</value>
                    <footnoteId id="F2"/>
                </natureOfOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <derivativeTable></derivativeTable>

    <footnotes>
        <footnote id="F1">The shares of common stock were purchased from HC2 Holdings 2, Inc., the indirect 100% shareholder of United Teacher Associates Insurance Company (&quot;UTAIC&quot;) and Continental General Insurance Company (&quot;CGIC&quot;), pursuant that certain securities purchase agreement, dated March 17, 2016.</footnote>
        <footnote id="F2">The securities of the Issuer reported herein are held directly by UTAIC, 8,338,270 shares, and CGIC, 3,135,529 shares. UTAIC and CGIC are direct wholly owned subsidiaries of Continental Insurance, Inc., and UTAIC and CGIC are indirect wholly owned subsidiaries of Continental Insurance Group Ltd.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>Continental Insurance Group, Ltd. By: /s/ James Corcoran, Executive Chair</signatureName>
        <signatureDate>2016-03-21</signatureDate>
    </ownerSignature>

    <ownerSignature>
        <signatureName>Continental Insurance, Inc. By: /s/ James Corcoran, Executive Chair</signatureName>
        <signatureDate>2016-03-21</signatureDate>
    </ownerSignature>
</ownershipDocument>
