Office No. 18, 9.17 Capital Tower, 91 Waterloo Road, London, SE1 8RT
Mon - Fri: 10.00 - 19.00 GTM+2
+38 095 841 41 64
contact@legalpilot.com
US

Is Gambling Legal in United States?

Partially Regulated
Gambling is regulated at the state level; some states allow most forms, others restrict or prohibit, with federal oversight on specific aspects.
Expert Gambling Regulation Guidance

Professional consultation on gambling regulations and legal compliance requirements for operators




    Key Information Highlights Legislation Timeline Requirements Sources

    Key Information

    Last Update 2025
    Regulatory Authority Varies by state (e.g., Nevada Gaming Control Board, New Jersey Division of Gaming Enforcement)
    License Cost Varies

    Regulation by Activity Type

    Casinos Regulated
    Online Casinos Regulated
    Betting Regulated
    Online Betting Regulated
    Lotteries Regulated
    Poker Regulated

    Highlights

    • Gambling regulation in the US is primarily determined at the state level, not federally.
    • Sports betting is legal and operational in 38 states and Washington, DC as of early 2025.
    • Online gambling laws vary widely by state, with some states restricting licenses and enforcing strict age verification.
    • Federal lawmakers are considering nationwide standards for online gambling consumer protections.
    • State regulators oversee licensing, enforce responsible gambling tools, and monitor operator compliance.
    • Taxation of gambling winnings and operator revenues is set by individual states, often funding public programs.
    • New regulations focus on responsible gaming, fraud prevention, and curbing misleading promotions by operators.
    Technical Compliance Assistance

    Our specialists will help you understand technical compliance requirements for gambling operations




      Legislation

      Primary Legislation

      The legal framework governing gambling in the United States is characterized by a combination of federal and state laws. At the federal level, several key statutes set the boundaries for gambling activities, while individual states have the authority to regulate, permit, or prohibit specific forms of gambling within their jurisdictions. The most significant federal laws include:
      • Federal Wire Act of 1961 – Prohibits certain types of betting businesses from using wire communication facilities to transmit bets or wagering information across state lines. Its interpretation has been central to the legality of interstate sports betting and online gambling.
      • Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006 – Targets financial transactions related to unlawful internet gambling, making it illegal for businesses to knowingly accept payments in connection with unlawful online gambling activities as determined by state or federal law.
      • Professional and Amateur Sports Protection Act (PASPA) of 1992 – Previously banned state-authorized sports betting nationwide, except for a few grandfathered states. PASPA was struck down by the Supreme Court in 2018, allowing states to legalize and regulate sports betting individually.
      • Indian Gaming Regulatory Act (IGRA) of 1988 – Establishes the regulatory framework for gaming operations on tribal lands, outlining the roles of federal, state, and tribal governments in the oversight of tribal gaming.
      In addition to these federal statutes, each state enacts its own gambling laws, which may permit, restrict, or prohibit various forms of gambling such as casinos, lotteries, sports betting, and online gaming. The result is a highly fragmented legal landscape, with significant variation between states regarding what forms of gambling are legal and how they are regulated.

      Regulatory Authority

      Oversight of gambling in the United States is divided between federal and state authorities, with primary regulatory responsibility typically residing at the state level. The main regulatory bodies include:
      • State Gaming Commissions and Lottery Boards – Each state that permits gambling establishes its own regulatory agency or commission to oversee all legal gambling activities, enforce state laws, and issue licenses. These bodies are responsible for regulating land-based casinos, online gambling, sports betting, lotteries, and charitable gaming within their jurisdictions.
      • National Indian Gaming Commission (NIGC) – A federal agency responsible for regulating and monitoring gaming activities on tribal lands as mandated by the Indian Gaming Regulatory Act.
      • Federal Law Enforcement Agencies – While not regulatory bodies, agencies such as the Department of Justice (DOJ) and the Federal Bureau of Investigation (FBI) are involved in enforcing federal gambling laws, particularly those related to illegal gambling operations and financial crimes.
      This dual structure of federal oversight and state-level regulation creates a complex environment where the legality and regulation of gambling activities can vary significantly from one state to another.

      License Types

      Overview of Gambling Licensing in the United States

      The United States operates a decentralized gambling licensing system. There is no single national gambling license; instead, licensing is managed at the state level. Each state determines which gambling activities are legal and establishes its own regulatory authority, licensing categories, procedures, and requirements. As a result, licensing frameworks, costs, and eligibility conditions vary significantly by jurisdiction and gambling vertical.

      Types of Gambling Licenses

      • Casino Licenses: Issued for land-based casinos, often requiring operators to meet strict suitability, financial, and operational standards. Some states also issue separate licenses for online casinos where permitted.
      • Sports Betting Licenses: Available in states where sports betting is legal. These may include licenses for retail sportsbooks, online/mobile sports betting, or both.
      • Poker Room Licenses: Required for operating dedicated poker rooms, either as standalone venues or within casinos. Online poker licensing is available in select states.
      • Lottery Licenses: Managed by state lottery commissions, these cover state-run lottery sales and, in some cases, online lottery offerings.
      • Supplier and Vendor Licenses: Required for companies providing gaming equipment, software, or services to licensed operators.
      • Fantasy Sports Licenses: Some states require specific licenses for daily fantasy sports operators.

      Application Process

      • Applications must be submitted to the relevant state gaming commission or regulatory authority.
      • Applicants undergo extensive background checks, including criminal, financial, and business history reviews of key personnel and stakeholders.
      • Detailed business plans, financial projections, and evidence of compliance policies (e.g., anti-money laundering, responsible gaming) are required.
      • Some states require public hearings or allow for public comment on applications.
      • Processing times vary by state and license type, typically ranging from several months to over a year for full casino or online gambling licenses.

      Duration and Renewal Conditions

      • Licenses are generally valid for a fixed period, commonly 1 to 5 years, depending on the state and license type.
      • Renewal requires continued compliance with all regulatory requirements, submission of updated documentation, and payment of renewal fees.
      • Some states mandate periodic suitability reviews for key personnel and owners as part of the renewal process.

      Eligibility Requirements

      • Applicants must demonstrate financial stability and the ability to operate a gambling business responsibly.
      • Key individuals must pass background checks and meet integrity and suitability standards.
      • Applicants must have a clear business structure and, in some states, a physical presence within the state.
      • Compliance with responsible gambling measures, anti-money laundering protocols, and data security standards is essential.

      Licensing Costs and Financial Requirements

      • Application Fees: Non-refundable and typically range from $10,000 to $100,000 or more, depending on the state and license type.
      • License Fees: Initial licensing fees for casinos and online gambling can range from $100,000 to several million dollars. Sports betting licenses often fall within a similar range.
      • Renewal Fees: Annual or periodic renewal fees are required, varying from tens of thousands to several hundred thousand dollars.
      • Financial Reserves: Some states require operators to maintain minimum cash reserves or post bonds to ensure payouts and regulatory compliance.
      • Other Costs: Applicants may incur additional costs for background investigations, compliance audits, and technology certifications.

      Key Requirements for Obtaining and Maintaining Licenses

      • Strict adherence to state-specific regulations and operational guidelines.
      • Implementation of robust responsible gambling programs, including self-exclusion and player protection tools.
      • Regular reporting to regulatory authorities, including financial statements and incident reports.
      • Ongoing cooperation with regulatory investigations and audits.
      • Prompt notification to regulators of any changes in ownership, management, or business structure.

      Summary Table: Typical Licensing Elements by Gambling Vertical

      License Type Application Fee Initial License Fee Duration Renewal Fee Key Requirements
      Land-Based Casino $10,000–$100,000+ $100,000–$10M+ 1–5 years $50,000–$500,000+ Background checks, financials, compliance
      Online Casino $50,000–$100,000+ $250,000–$5M+ 1–5 years $100,000–$500,000+ Tech certification, responsible gaming, AML
      Sports Betting $10,000–$100,000+ $100,000–$5M+ 1–5 years $50,000–$250,000+ Integrity monitoring, data security
      Supplier/Vendor $5,000–$25,000 $10,000–$100,000 1–3 years $5,000–$50,000 Product certification, background checks
       

      Gambling Tax

      Tax Rates for Gambling Operators in the United States

      Gambling taxation in the United States is highly decentralized, with tax rates and bases varying significantly by state and by type of gambling operation. The federal government does not impose a direct tax on gambling operators, but certain federal excise taxes may apply. Below is an overview of typical tax rates for key gambling sectors:
      Type of Gambling Typical Tax Rate Tax Base Notes
      Commercial Casinos 6.75% – 50% (varies by state) Gross Gaming Revenue (GGR) Most states use GGR; Nevada: 6.75%, Pennsylvania: up to 54% on slots
      Sports Betting 6.75% – 51% (varies by state) GGR New York: 51% online, Nevada: 6.75%
      Online Gambling (Casino/Poker) 15% – 54% (varies by state) GGR Pennsylvania: 54% on slots, 16% on table games
      Tribal Gaming Negotiated (often 0%–25%) Net Win or GGR Determined by tribal-state compacts; may include revenue sharing
      Lottery State retains all net proceeds Total Sales minus Prizes & Expenses Lotteries are state-run; proceeds fund public programs
      Pari-mutuel (Racing) Varies (often 1%–6% of handle) Handle or GGR State-specific; sometimes taxed on handle (total wagers)

      Basis for Taxation

      • Gross Gaming Revenue (GGR): Most states tax gambling operators based on GGR, which is the difference between total wagers and winnings paid out to players.
      • Handle: Some forms, such as pari-mutuel wagering, may be taxed on the handle (total bets taken).
      • Net Win/Revenue Sharing: Tribal gaming taxation is typically negotiated in compacts, often as a percentage of net win or GGR, or as revenue sharing payments to the state.

      Tax Reporting and Payment Requirements

      • Operators must file regular tax returns with the relevant state gaming or revenue authority, typically on a monthly or quarterly basis.
      • Tax payments are usually due at the same frequency as filings, with strict deadlines and penalties for late payment.
      • Operators must maintain detailed records of wagers, payouts, and GGR for audit and compliance purposes.
      • Tribal operators report and remit payments as specified in their individual state compacts, often to a designated state agency or fund.
      • Some states require additional reporting for promotional credits, jackpots, and non-gaming revenue.

      Tax Incentives, Exemptions, and Special Provisions

      • Some states offer tax incentives for capital investment, job creation, or development in economically distressed areas.
      • Tribal gaming operations may be exempt from certain state taxes under federal law, but often pay negotiated revenue shares in exchange for exclusivity or other benefits.
      • Promotional credits and free play may be subject to special tax treatment, with some states allowing deductions from GGR.
      • Federal excise taxes apply to certain wagering activities, such as a 0.25% tax on sports wagers, but these are generally passed on to players or absorbed by operators.
      • State-run lotteries are typically exempt from state corporate income tax, as proceeds are directed to public funds.

      Prohibited Individuals

      Age Restrictions and Identification Requirements

      • The minimum legal age for gambling in the United States is typically 21 years old for casino gaming and sports betting, though some states permit certain forms of gambling (such as lotteries or pari-mutuel betting) at age 18.
      • Operators are required to verify the age and identity of all players through official identification documents to prevent underage gambling.
      • Online gambling platforms must implement robust Know Your Customer (KYC) procedures, including checks against government-issued IDs and, in some cases, Social Security Number verification, to confirm player eligibility.

      Prohibited Activities and Game Restrictions

      • Political event betting and prediction markets involving political outcomes are explicitly prohibited at the federal level and in most states.
      • Some forms of online gambling, such as online casino games and poker, remain illegal in several states, even where sports betting is permitted.
      • Unlicensed gambling activities, including unauthorized online operators and private betting rings, are strictly forbidden.
      • States may restrict specific games or betting types, such as limiting in-play or proposition bets on college sports or prohibiting certain casino games.

      Advertising and Marketing Limitations

      • Gambling advertising must not target minors or vulnerable populations and is restricted from appearing in media or locations primarily accessed by underage individuals.
      • Operators are prohibited from making misleading claims about the chances of winning or from promoting gambling as a solution to financial problems.
      • Bonus offers, promotions, and inducements must be presented clearly, with all terms and conditions disclosed upfront.
      • Some states require all gambling advertisements to include responsible gambling messages and helpline information.

      Responsible Gambling Requirements and Player Protection Measures

      • Operators must provide access to self-exclusion programs, allowing players to voluntarily ban themselves from gambling activities for set periods or permanently.
      • Mandatory responsible gambling resources, such as links to problem gambling helplines and educational materials, must be prominently displayed on operator websites and in physical venues.
      • Deposit, loss, and time limits must be available for players to set personal controls on their gambling activity.
      • Operators are required to monitor player behavior for signs of problem gambling and, in some jurisdictions, intervene or restrict accounts if harmful patterns are detected.
      • Some states mandate funding for problem gambling treatment and prevention programs, often sourced from gambling tax revenue.

      Geographic and Location Restrictions

      • Online gambling operators must use geolocation technology to ensure that players are physically located within state borders where the activity is legal.
      • Land-based gambling venues, such as casinos and sportsbooks, are only permitted in approved locations as determined by state or tribal authorities, and may be restricted to specific zones or reservation lands.
      • Remote registration and play are only allowed where expressly permitted by state law; in some states, in-person registration at a licensed venue is required before online play.
      Gambling Regulatory Consultation

      Get expert advice on gambling regulations and operational requirements




        Timeline

        Year/Date Event
        1907 Nevada legalizes gambling, but later bans it in 1910.
        1931 Nevada re-legalizes casino gambling, establishing Las Vegas as a gambling hub.
        1951 Federal Gambling Tax Act imposes a tax on illegal gambling operations, targeting bookmaking and numbers games.
        1961 Federal Wire Act is enacted, prohibiting certain types of betting businesses from using wire communications for interstate or foreign bets.
        1978 New Jersey legalizes casino gambling in Atlantic City, becoming the second state after Nevada to do so.
        1988 Indian Gaming Regulatory Act (IGRA) is passed, allowing federally recognized tribes to operate casinos on tribal lands under federal regulation.
        1992 Professional and Amateur Sports Protection Act (PASPA) is enacted, effectively banning sports betting nationwide except in a few grandfathered states.
        2006 Unlawful Internet Gambling Enforcement Act (UIGEA) is passed, restricting online gambling by prohibiting financial transactions related to unlicensed gambling sites.
        2018 U.S. Supreme Court strikes down PASPA, allowing states to legalize and regulate sports betting individually.
        2020s Widespread legalization and regulation of online sports betting and casino gaming at the state level, with over 30 states legalizing sports betting by 2025.

        Requirements

        Software Certification and Technical Standards

        • All gambling software, including random number generators (RNGs), game logic, and betting platforms, must undergo certification by independent testing laboratories approved by state regulators. Certification ensures fairness, integrity, and compliance with technical standards established by each jurisdiction.
        • Operators are required to implement secure communication protocols (such as SSL encryption) for all data transmissions between the player, the operator, and third-party service providers.
        • Technical standards often mandate regular penetration testing and vulnerability assessments to identify and remediate security risks.
        • Game outcomes and payout percentages must be verifiable and auditable, with detailed logs maintained for regulatory review.
        • Platforms must provide robust player account management systems, including secure authentication, session tracking, and protection against unauthorized access.

        Data Protection, Privacy Measures, and Server Location Requirements

        • Operators must comply with state and federal data protection laws, ensuring the confidentiality, integrity, and availability of player data.
        • Personal and financial data must be encrypted both in transit and at rest, with strict access controls and audit trails for all data handling activities.
        • Some states require that gambling servers and data storage be physically located within state borders or in approved jurisdictions to facilitate regulatory oversight and ensure compliance with local laws.
        • Operators must provide clear privacy policies to users, outlining data collection, retention, and sharing practices.

        Anti-Money Laundering (AML) and Know Your Customer (KYC) Procedures

        • Operators are obligated to implement comprehensive AML programs, including customer due diligence, monitoring of transactions, and reporting of suspicious activities to relevant authorities.
        • KYC procedures require verification of player identity, age, and residence through reliable documentation before allowing deposits, withdrawals, or significant gameplay activity.
        • Automated systems must flag unusual or high-risk transactions for further investigation, and operators must maintain records of all AML and KYC checks for regulatory review.
        • Regular staff training on AML and KYC obligations is mandatory, with documented policies and procedures in place.

        Financial Reporting, Auditing Standards, and Record-Keeping Requirements

        • Operators must maintain accurate, up-to-date financial records, including transaction logs, player account balances, and all monetary flows related to gambling activities.
        • Periodic financial reports and gaming activity summaries must be submitted to state regulators in prescribed formats.
        • Independent audits of financial statements and gaming systems are required at regular intervals, with auditors approved by the relevant regulatory authority.
        • Operators must retain all records, including player data, financial transactions, and system logs, for a minimum period as specified by state law (often several years).

        Responsible Gambling Tools and Technical Implementation Requirements

        • Operators must integrate technical tools that allow players to set deposit, loss, wager, and session time limits directly within their accounts.
        • Self-exclusion mechanisms must be available, enabling players to voluntarily block themselves from accessing gambling services for specified periods.
        • Systems must include real-time monitoring to detect and intervene in cases of problematic gambling behavior, including automated notifications and referral to support resources.
        • Operators are required to display responsible gambling information prominently and provide access to helplines and support organizations.
        • All responsible gambling features must be auditable and tamper-proof, with logs maintained for regulatory inspection.

        Sources

        # Official Sources for Gambling Regulation in the United States

        Federal Regulatory Authorities

        State-Level Gambling Authorities

        Legal Resources and Information Portals

        Contact Information for Regulatory Inquiries

        • American Gaming Association: 202-552-2675
        • National Indian Gaming Commission: 202-632-7003
        • State regulatory contacts can be found on respective state gaming commission websites

        Industry Compliance Resources

        Navigate Gambling Regulations Successfully

        Professional guidance on regulatory compliance for gambling operations




          Bahamas Canada

          Important Information Notice

          Gambling regulations are subject to change. The information provided on this page was accurate at the time of publication, but may not reflect the current regulatory landscape. Always consult official sources for the most up-to-date information before making any gambling-related decisions.

          Last updated: 22 April 2025