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Virginia’s effort to legalize online casino gaming remains on hold after Senate Bill 827 failed to pass in January 2025. The $1 authority to license and oversee iGaming, but was set aside for further review. As it stands, the legislation is unlikely to return before the 2026 session.
In the meantime, the Joint Subcommittee to Study the Feasibility of Establishing the Virginia Gaming Commission met on Tuesday to hear the advantages, drawbacks, and challenges of legal online casinos in the state. Real-money casinos offer convenience since players can play on their phones, while critics note that they present risks for both consumers and policymakers.
Sponsor Sen. Mamie Locke delayed the bill to give lawmakers more time to assess both fiscal and regulatory risks. The Virginia Lottery raised concerns that the measure could harm lottery funds and strain its operational capacity.
The pause has set the stage for a long-running debate heading into 2026, shaping the potential impact on players, operators and state coffers.
Where Virginia Online Casinos Stand After 2025 Setback
Senate Bill 827, introduced by Sen. Mamie Locke, sought to open the doors to legal online casinos in Virginia. The plan called for regulation through the Virginia Lottery.
It would have allowed each land-based casino in the state to operate up to three online casino platforms. Operators would pay a $1 million licensing fee and a 15% tax on revenue, with a portion dedicated to responsible gambling programs.
Lawmakers tabled the bill after fiscal analysts warned that iGaming could reduce lottery sales, a major source of state revenue. The Virginia Lottery also objected, noting its resources were already stretched by new casino openings and oversight of sports betting.
A companion bill in the House also failed, and both chambers agreed to defer the debate until the next full session.
Virginia Online Casinos Stalled by Fears of Revenue Loss
Regulators cautioned that the Virginia Lottery is already stretched thin as it expands oversight of new brick-and-mortar casinos and a rapidly growing sports betting market. Officials argued it had little capacity to take on the complex management that online casino legalization would require.
Fiscal analysts raised another concern: Legal iGaming could siphon players from the state lottery, which has become a steady revenue stream for education and other programs. Once administrative and enforcement costs were factored in, analysts said the net fiscal benefit was uncertain.
Some land-based casino operators also worried that online platforms would cannibalize in-person traffic and local spending. That concern has slowed iGaming in other states, where lawmakers weigh the tradeoff between new tax receipts and protecting existing revenue streams.
How Virginia Casinos Are Expanding Without Online Play
Virginia’s land-based casino industry is growing, led by Rivers Casino Portsmouth, Hard Rock Hotel & Casino Bristol and Caesars Virginia in Danville. In May 2025, the three casinos generated adjusted gaming revenue of $85.4 million, up $6.6 million from the previous month. Caesars Virginia led with $34.1 million.
For the first half of 2025, the casinos reported $475.3 million in revenue, a 33% increase compared to the same period in 2024. Meanwhile, the state’s sports betting market continues to post steady growth. Still missing from the mix is online casino gaming, which proponents argue could complete Virginia’s emerging gaming landscape.
Can Virginia Online Casinos Gain Ground in 2026?
Sen. Mamie Locke requested that the bill be deferred for further study and consultation with stakeholders. She expects to revisit the issue during the 2026 legislative session. In the meantime, lawmakers and advocates plan to refine elements of the framework.
Proposed revisions include adjusting the 15% tax rate, licensing fees, and regulatory structure, according to a story by the Virginia Mercury. The next version of the bill is also expected to expand responsible gambling provisions, such as increasing the 2.5% allocation for addiction treatment and enhancing protections for lottery revenues.
The 30-day 2025 session left little room for extensive debate. Lawmakers expect the 2026 full session to provide a more favorable environment for comprehensive discussions. Virginia Lottery officials and Gaming Committee Chair Del. Paul Krizek have expressed support for pursuing a more balanced and sustainable approach.
Future of Virginia Online Casinos Hinges on 2026 Decisions
Analysis Group estimated Virginia could generate up to $5.3 billion in iGaming revenue between 2025 and 2029, alongside modest growth in brick-and-mortar casino income.
But challenges remain. Lottery officials and land-based operators are expected to oppose parts of the plan, citing potential revenue losses and regulatory strain. Responsible gambling provisions—including spending limits and expanded addiction funding—are likely to feature prominently in negotiations.
Virginia is one of the fastest-growing gaming markets in the country and is likely to legalize online casinos soon. However, much depends on how lawmakers define and control the industry’s rollout. The subcommittee plans to hold two more meetings before the next General Assembly session begins in January. The September meeting plans to focus on existing and planned casinos. The final meeting plans to look at broader gaming issues, such as skill games and charitable gaming, all ahead of the 2026 session.
For now, Virginia’s online casino future remains in limbo until 2026. Sports betting and land-based casinos continue to dominate, but the real test will be not whether iGaming arrives, but how it is structured when it does.
