The Landscape of U.S. Online Casino Legislation: Key Laws, Jurisdictions, and Trends

Although most rules are set at the state level, federal legislation has historically established the framework and boundaries for online gambling. Two key pieces of legislation in particular have shaped how states approach legalization and enforcement.

Impact of the Unlawful Internet Gambling Enforcement Act (UIGEA)

One of the most influential federal laws affecting online gambling is the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006. This act targets online gambling by prohibiting banks and financial institutions from processing payments connected to unlawful online gambling.

The law itself does not directly make online gambling illegal in the U.S. Its purpose was to make it harder for people to deposit or withdraw funds from gambling websites that are not explicitly authorized under state or federal law.

However, the act never defined exactly what counts as “unlawful” online gambling. This left room for states to regulate their own online gambling markets in the years that followed.

The Wire Act and the DOJ’s Shifting Interpretations

The Federal Wire Act of 1961 was originally designed to combat organized crime by prohibiting interstate sports betting via telecommunications systems.

With the rise of the internet and online betting, this decades-old law took on new relevance. For years, it was broadly interpreted as applying to all forms of online gambling, creating widespread uncertainty about the legality of online casinos and poker in the U.S.

In 2011, the Department of Justice (DOJ), under President Barack Obama, issued a legal opinion clarifying that the Wire Act applied only to sports betting, not to other forms of online gambling. This landmark decision opened the door for individual states to legalize and regulate online poker, casino games, and lotteries within their borders.

In 2018, the DOJ, under President Donald Trump, reversed this position after reinterpreting the original language of the Wire Act to mean it applied to all forms of online gambling, not just sports betting. The ruling faced numerous legal challenges, and in 2021 a federal court struck down the DOJ’s interpretation, effectively keeping the 2011 stance in place.

The legality and growth of online casinos in the U.S. are complex, to say the least. The industry operates under a patchwork of state-level laws, with each jurisdiction setting its own requirements for licensing, taxation, and compliance.

Below is a closer look at the U.S. states that have legalized online gambling and those moving toward legalization in the short to medium term.

The following states allow licensed operators to offer a full range of online gambling options, including casino games and poker.

New Jersey: A Pioneer and Market Leader

New Jersey is the most valuable online casino market in the U.S., generating over $10.04 billion in revenue since online gambling was first legalized in 2013. It’s home to major online casino brands like BetMGM, DraftKings, and FanDuel, which operate through partnerships with Atlantic City’s land-based casinos.

As the most established online casino market in the U.S., New Jersey offers strong player protections, responsible gaming initiatives, and anti-fraud measures.

• Legalized Online Gambling: 2013
• Regulatory Body: New Jersey Division of Gaming Enforcement (NJDGE)

Pennsylvania: A Rapidly Growing Market

Pennsylvania is one of the fastest-growing online casino markets in the U.S., with annual revenues exceeding $1.5 billion. It also has a higher tax rate (54% on online slots) compared to other states that permit online gambling.

Following a model similar to New Jersey, multiple online casino brands operate in partnership with state-licensed land-based casinos. This makes it a highly attractive market for operators, and its growth shows no signs of slowing.

• Legalized Online Gambling: 2017
• Regulatory Body: Pennsylvania Gaming Control Board (PGCB)

Delaware: A Pioneering Online Casino Market

Delaware was the first U.S. state to legalize online gambling in 2012, yet its market remains relatively small. In 2024, Delaware’s online casinos generated approximately $78.4 million in gross gaming revenue (GGR).

Initially, Delaware’s state-run online casinos operated under a monopoly system in partnership with 888 Holdings. In late 2023, however, the Delaware Lottery transitioned to a new partnership with Rush Street Interactive’s BetRivers, replacing 888 Holdings as the exclusive online gambling provider.

Delaware also participates in the Multi-State Internet Gaming Agreement (MSIGA), sharing online poker liquidity with Nevada, Michigan, West Virginia, and New Jersey.

• Legalized Online Gambling: 2012
• Regulatory Body: Delaware Lottery

Michigan: A Booming New Online Casino Market

Launched in 2021—two years after online gambling was officially legalized—Michigan has quickly grown into one of the top-performing states. Online gambling generates an estimated $1.5 billion annually, contributing significant tax revenue to the state’s budget.

Major operators include BetMGM, FanDuel, DraftKings, and Caesars, all partnering with Michigan’s commercial and tribal casinos as required by state law.

With the state allowing the full suite of online casinos, poker, and sports betting, Michigan has one of the most comprehensive online gambling markets in the U.S. The state also permits interstate online poker, which boosts player pools and tournaments.

• Legalized Online Gambling: 2019
• Regulatory Body: Michigan Gaming Control Board (MGCB)

West Virginia: A Market with Significant Growth Potential

Licensed online casinos began launching in 2020, making West Virginia one of the newest and least developed markets in the U.S. The state allows online casino games, poker, and sports betting. Licenses are issued to the state’s five land-based casinos, which may partner with third-party operators to offer online platforms.

One factor limiting growth is West Virginia’s smaller population, resulting in a naturally smaller player base than in other legalized states. However, the market is poised for expansion, as casinos may partner with up to three interactive gaming management services to provide online offerings.

While not as large as New Jersey or Pennsylvania, West Virginia’s online casino market is steadily expanding. As competition increases and regulations evolve, the state’s online gambling industry is expected to see rising revenue opportunities.

• Legalized Online Gambling: 2019
• Regulatory Body: West Virginia Lottery Commission

Connecticut: A Thriving Tribal Alliance

Connecticut legalized online gambling following an agreement between the state government and two federally recognized tribal nations: the Mashantucket Pequot Tribe and the Mohegan Tribe. Both tribes hold exclusive rights to offer online casino gaming, each operating one platform.

Market growth has been steady, with strong participation from local players across Connecticut. By May 2024, the state’s online casino industry reached a new high of $46.3 million in gross revenue, marking a 41.3% year-over-year increase.

Future expansion may include online poker, depending on upcoming regulatory developments.

• Legalized Online Gambling: 2021
• Regulatory Body: Connecticut Department of Consumer Protection (DCP)

Rhode Island: A One-Operator Monopoly in Motion

Rhode Island became the seventh U.S. state to legalize online casino gambling in June 2023. The first—and only—online casino launched in March 2024.

Online casino gaming is operated exclusively by Bally’s Corporation under a 20-year no-bid contract, giving Bally’s a monopoly on Rhode Island’s digital casino market in partnership with International Game Technology (IGT).

It’s still too early to measure the market’s long-term success, but with 2024 revenues projected at around $50 million, early signs are promising. However, because the licensing structure does not allow competition, future expansion opportunities may be limited.

• Legalized Online Gambling: 2023
• Regulatory Body: Rhode Island Lottery

As interest in legalizing online casino gambling grows, it’s important to know which states may soon join the industry. Several U.S. states are actively considering the legalization of online casino gambling. Here’s a brief overview of the most likely contenders and their positions as of early 2025.

Nevada: The Poker Capital with No Online Casinos

Despite being home to the global casino hub of Las Vegas, playing online slots or table games is not legal in Nevada. For now, only online poker is permitted within the state’s borders.

Nevada participates in an interstate liquidity-sharing agreement with New Jersey and Delaware through the Multi-State Internet Gaming Agreement (MSIGA). This allows for larger poker player pools and higher payouts.

At present, any future expansion into online casino licensing remains uncertain, largely due to the strength of Nevada’s land-based gaming industry, which generated $15.76 billion in revenue in 2024 alone.

• Legalized Online Gambling: 2013 (Online Poker Only)
• Regulatory Body: Nevada Gaming Control Board (NGCB)

New Hampshire: A Mixed Path to Online Casino Legalization

New Hampshire legalized online sports betting in 2019, raising hopes that online casino gambling would follow soon after. However, the New Hampshire Lottery Commission (NHLC), which oversees all gambling in the state, has taken a more cautious approach.

Currently, New Hampshire does not permit online casino games such as slots, roulette, or blackjack. Senate Bill 168, introduced in 2025 to legalize online gaming, was tabled in the Senate and is not advancing at this time.

The recent approval for Cordish Companies to build a $200 million land-based casino may further stall online casino gambling. Cordish is a strong opponent of online gambling and is likely to influence future decisions in the state.

• Legalized Online Gambling: 2019 (Sports Betting Only)
• Regulatory Body: New Hampshire Lottery Commission (NHLC)

Other States Looking to Legalize Online Casinos

Beyond Nevada and New Hampshire, several other states are cautiously exploring the legalization of online casino gambling.

However, legalization is rarely straightforward. The process involves negotiations among lawmakers, regulators, and stakeholders, making timelines uncertain. Operators aiming to enter these markets should stay up to date, as shifting political priorities can either accelerate or stall progress.

As of March 2025, here’s an overview of states on the cusp of legalizing online casino gaming:

Passing laws to legalize online casinos in the U.S. is only the first step in creating a sustainable and compliant gambling market nationwide.

All states that currently allow online casino gaming impose strict licensing requirements and regulatory frameworks to ensure fair play, player protection, and responsible gambling.

Licensing Requirements and Regulatory Oversight

Each state that has legalized online gambling sets its own licensing process and regulatory framework. At present, no federal laws directly govern licensing beyond the Unlawful Internet Gambling Enforcement Act (UIGEA) and the Federal Wire Act.

That said, the U.S. online casino market is evolving rapidly, making it essential to stay current with both federal and state laws.

Typical state regulations include rigorous application requirements, background checks, financial stability reviews, and, in many cases, partnerships with existing land-based casinos.

To obtain a license, operators must meet the following core regulatory requirements set by each state:

• Licensing Authorities: Regulatory agencies such as the New Jersey Division of Gaming Enforcement (NJDGE) and the Pennsylvania Gaming Control Board (PGCB) oversee compliance and issue licenses to approved operators.
• Financial Stability and Compliance: Operators must demonstrate financial strength, provide transparent business models, and comply with anti-money laundering (AML) regulations.
• Taxation and Revenue Distribution: States impose varying tax rates on online casino revenue, often allocating funds to public programs such as education, infrastructure, and responsible gambling initiatives.

Responsible Gambling Measures

To proactively address problem gambling and promote responsible play, states require operators to implement strict player protection measures, including:

• Self-Exclusion Programs: Players can voluntarily exclude themselves from online gambling platforms for a set period.
• Deposit and Betting Limits: Many states mandate tools that allow players to set personal limits on their gambling activities.
• Mandatory Responsible Gambling Messaging: Licensed operators must clearly display information about responsible gambling resources and helplines.
• Advanced Monitoring: Some platforms use human oversight or artificial intelligence to detect problem gambling behaviors and intervene when necessary.

The online gambling landscape in the U.S. is poised to keep evolving rapidly. Several key trends and developments will play major roles in shaping its short- to medium-term future.

To remain competitive, operators must be prepared for the following potential changes and adjust their market strategies accordingly.

Expanding State Legalization

With the success of online gambling in states such as New Jersey, Pennsylvania, and Michigan, more states are expected to consider legalization. For many, the promise of increased tax revenue and job creation will be the strongest drivers.

However, resistance from anti-gambling advocacy groups and land-based casino interests may slow progress in certain jurisdictions. As more states adopt regulatory frameworks, others are likely to leverage these models to shape their own legislation.

Federal Regulatory Developments

While online gambling is still largely governed on a state-by-state basis, future federal involvement is increasingly possible. Calls for nationwide regulatory frameworks are growing in response to rising interstate gambling activity, fraud concerns, and consumer protection issues.

Any federal policy changes—such as a new reinterpretation of the Wire Act—could significantly affect the online casino industry. It remains uncertain which direction the current White House administration will take.

Technological Innovations

Advances in technology are influencing the global future of online gambling and shaping when and how states across the U.S. adopt legal online casinos.

Key innovations expected to drive the industry include:

• Live Dealer Games: Rising demand for real-time, interactive play that offers a more authentic casino experience.
• Cryptocurrency and Blockchain: Potential integration of digital currencies and decentralized gambling platforms.
• Virtual Reality (VR) and Augmented Reality (AR): Immersive gaming experiences that replicate the feel of a physical casino.
• Artificial Intelligence (AI): Improved personalization, fraud detection, and responsible gambling interventions.

Interstate and International Expansion

As more states legalize online casinos, the potential for multi-state gaming agreements—similar to those currently used in online poker—is expected to grow.

In addition, partnerships between U.S. operators and international gaming companies could drive cross-border expansion, opening new revenue streams and increasing competition.

The U.S. online gambling market is evolving at an unprecedented pace, shaped by changing legislation, technological progress, and rising player demand. Current trends suggest that more states will legalize online gambling in the coming years, motivated by the promise of tax revenue and economic growth.

That said, significant challenges remain. A patchwork of state-by-state regulations, resistance from entrenched gaming interests, and the potential for federal intervention all complicate expansion.

To succeed, operators must monitor legislative developments closely, stay compliant with evolving state laws, and leverage new technologies to improve player experiences. Strategic partnerships, strong responsible gambling programs, and adaptive business models will be critical to long-term success.

If you’re ready to tap into the vast potential of the U.S. online gambling market, Agreegain is here to help. Connect with our U.S. market consultants today to explore how we can provide the tools and expertise you need to make your next move stateside.