Nye attended Cameron High School in Cameron, Oklahoma. He was high school teammates with his first cousin, Kevin Lomon. His younger brothers also played at Cameron and were selected in the 1993 and 1995 Major League Baseball drafts. As a senior in 1991, Nye threw at least two perfect games as a senior and, as of the start of that year's state tournament, had a 43-0 career win-loss record as a pitcher.
That June, Nye was drafted by the Seattle Mariners in the 43rd round of the 1991 Major League Baseball draft but chose not to sign. Nye instead followed Lomon to begin his college baseball career at Westark Community College. After one year at Westark, he was drafted again by the Mariners in the 22nd round of the 1992 draft but again did not sign. He next played at Texas Tech. In one season with the Red Raiders, he led the team in wins, innings pitched and earned run average. He was named First Team All-America by the National Collegiate Baseball Writers Association, the American Baseball Coaches Association and USA Today.
Nye was selected by the Philadelphia Phillies in the second round of the 1994 Major League Baseball draft and assigned to the Batavia Clippers to begin his professional career. The Phillies added Nye to their 40-man roster in November 1996.

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