Life on the outside is proving to be GOOOOOD for Bobby Shmurda -- the formerly incarcerated rapper got the VIP treatment at the Brooklyn Nets game on Monday ... and a signed jersey from superstar James Harden!

The 26-year-old had been in custody since December 2014 after he was charged with conspiracy to murder and other gun charges.

In 2016, Shmurda copped a plea deal to conspiracy to possess weapons and possession of a weapon -- and was sentenced to 7 years in prison followed by 5 years probation.