Gradle 7.3 is the first version fully supporting Java 17. From the Release Notes:

Support for Java 17

Gradle now supports running on and building with Java 17.

In previous Gradle versions, running Gradle itself on Java 17 resulted in an error. JVM projects could have been built with Java 17 using toolchains.

As of Gradle 7.3, both running Gradle itself and building JVM projects with Java 17 is fully supported.

From version 7.3 Gradle is officially supporting Java 17. For more details, compatibility matrix can be seen here and details of releases can be seen from here.