Legal US Online Gambling Guide

History And Guide To Legal Online Gambling In The United States

Play USA > Legal US Online Gambling Guide

Interested in US legal gambling? Click any state in the map below to learn more about the legal gambling options – including casino, lottery, and online gambling – in that particular state. You can also scroll down to learn more about the history of online gambling in the United States.

State-by-state legal gambling guide

  • States in green have passed online gambling bills.      
  • States in blue had an online gambling bill in 2018.

 

Legal online casino games in the US

New Jersey

New Jersey passed online gambling legislation in 2013. This allowed Atlantic City casinos to apply for internet gaming permits and host a variety of online poker and online casino sites under those licenses.

The casino operations granted licenses included:

  • Borgata Hotel Casino & Spa
  • Caesars Interactive Entertainment
  • Golden Nugget Atlantic City
  • Resorts Casino Hotel
  • Tropicana Casino and Resort
  • Trump Taj Mahal

Trump Taj Mahal partnered with Ultimate Gaming to launch online poker and online casino sites that have since shut down.

The other licensees were operating 21 different online poker and casino sites as of the beginning of the second quarter of 2017. The online casino sites offer a wide variety of slots and traditional casino games. The online casino sites in New Jersey include:

New Jersey’s online gaming industry posted record revenues of $196.7 million in 2016. This was a 32.1 percent increase over 2015. It also helped the Atlantic City casino industry post an increase in total gambling revenues for the first time in a decade.

Pennsylvania

Online casinos are not operational in Pennsylvania yet. However, as of Oct. 30, 2017 the law states Pennsylvania can offer regulated and legalized online casinos. The online casino measure is part of a larger act which also legalized:

  • Online poker
  • Daily fantasy sports
  • Online lottery
  • Video gaming terminals in truck stops
  • Satellite casinos

The plan as of now is to offer 12 online casino licenses in the state. That is the same number of brick and mortar casinos in the state. When Philly Live! opens in the stadium district of Philadelphia, the number of licenses will go to 13.

Delaware

Delaware became the first state to legalize online gambling in 2012. The market opened up in November 2013 with sites operated through the state’s three horse tracks. This includes Dover Downs, Delaware Park, and Harrington Raceway. These sites offer a variety of Blackjack, Roulette, Video Slots and Video Poker games.

Like the state, the Delaware market is relatively small. However, the Delaware online gaming industry posted its best numbers in 2016, generating $3 million in revenue. Delaware Park led the way with $1.4 million, Dover Downs recorded a little over $1 million and Harrington Raceway claimed $534,000 in revenue.

Legal online poker in the US

 

New Jersey

New Jersey authorized online gaming licensees to launch online poker and online casinos when the market opened up in 2013.

Online poker sites currently operating in the market include:

  • Borgata Poker
  • NJ partypoker
  • Pala Poker
  • WSOP.com NJ
  • NJ 888 Poker
  • PokerStars NJ

WSOP.com and NJ 888 poker share player pools. PokerStars NJ was a late entry into the market, launching in the Spring of 2016. However, it has become the market leader. Pala Poker is the latest entry into the New Jersey online poker market, launching in June 2017.

Overall online gambling revenues continue to climb in New Jersey, averaging close to $20 million a month in 2017. However, online poker remains a relatively small percentage of that. In fact, New Jersey online poker revenues seem to average around $2 million per month, representing just 10 percent of the overall online gambling market in the state.

That will change soon though. In the fall of 2017, the state agreed to pool online poker players with both Nevada and Delaware.

Nevada

Online poker is the only licensed and regulated form of online gambling in the state of Nevada.

Station Casinos’ Ultimate Poker was the first to go live on April 30, 2013. However, WSOP.com Nevada launched in September of that same year and quickly became market leaders. WSOP.com employs 888 Holdings software and heavily cross-promotes its online offering through the World Series of Poker. These efforts include online satellites to WSOP bracelet events and online WSOP bracelet events themselves.

Real Gaming has since launched a competing online poker room affiliated with the South Point Casino. The site only offers No Limit Texas Hold’em cash games and one-table tournaments.

Ultimate Poker shut down in November 2014, leaving just two online poker sites operating in Nevada.

In March 2015, Nevada and Delaware entered into a poker liquidity sharing agreement which is run through WSOP.com in Nevada.

Delaware

Delaware’s three horse-track based online gambling sites offer peer-to-peer online poker with software provided by 888 Holdings. Delaware and Nevada began sharing online poker traffic in March 2015. However, the Delaware online poker market remains small, posting one of the lowest player participation rates in the world since its inception.

Pennsylvania

In October of 2017, Pennsylvania passed a massive gambling expansion bill into law. As part of the expansion, the state can now legally offer regulated online poker within the state.

The language of the law also sets up the possibility for the state to easily enter into interstate compacts like the one between Nevada, Delaware, and New Jersey.

Online lottery sales in the US

Georgia

The Georgia Lottery Corporation allows residents to play online from anywhere in Georgia. Players can buy tickets for draw games, including Fantasy 5, Mega Millions, Powerball. There are also Keno games available and the Georgia Lottery’s exclusive interactive Diggi Games. These are essentially social game and electronic scratch-off hybrids including crosswords and bingo games.

Online lottery sale went live in the state in November 2012. The launch coincided with the release of a lottery debit card players can use online called the iHOPE. It allows players to preload funds, buy tickets and download winnings.

Illinois

Illinois launched a pilot program offering online sales of Lotto and Mega Millions tickets in March 2012. This made Illinois the first state to offer online lottery ticket sales. By December 2012, the Illinois Lottery’s website was also offering tickets for the popular multi-state Powerball lottery. It has since expanded to include Daily Lottery Games and Instant Games, the online equivalent of instant ticket scratch-offs.

In April 2014, Illinois Lottery officials announced online tickets sales had reached $36.9 million in the program’s first two years.

Michigan

The Michigan Lottery officially launched online lottery sales in the Fall of 2014. Michigan residents were then allowed to buy tickets for Instant Keno and electronic scratch-off game equivalents from a computer, smartphone, or tablet device. In January 2016, the Michigan Lottery began draw game ticket sales online. This allowed Michigan residents to buy tickets online for the most popular draw games, including Powerball, Mega Millions, Lotto 47, and Fantasy 5. Players have to be Michigan residents over the age of 18. Plus, they must sign up for an account on the Michigan Lottery website to make purchases.

Learn more about Michigan online lottery here.

Kentucky

Kentucky became the latest state to offer online lottery ticket sales in 2016. The state offers online sales of jackpot and daily draw games as well as instant play games. Online ticket sales were actually approved in 2013. However, it took the state three years to develop its complex online ticketing and security system. Players have to set up an account and deposit money to buy tickets. Deposits cannot be withdrawn in accordance with money-laundering laws.

New Hampshire

In June of 2017, New Hampshire became the fifth state to pass laws allowing for online lottery sales.

Pennyslvania

As part of a large gambling expansion bill that passed in October 2017, Pennsylvania is the latest state to legalize the online lottery. The lottery is set to launch with a limited offering of products, including instant scratch-off games, in May of 2018.

Daily fantasy sports in the US

Daily fantasy sports sites operate in numerous states. Some have authored legislation regulating and taxing operators, while others do not.

New York was really the first state to take on DFS operators after the game’s popularity began to rise. New York Attorney General Eric Schneiderman issued a cease-and-desist order to top DFS operators DraftKings and FanDuel in November 2015. At the time, Schneiderman claimed DFS was illegal gambling under state law and really just a re-branded version of sports betting.

A protracted legal battle and negotiated went on until August 2016 when NY Governor Andrew Cuomo signed a bill allowing DFS sites to serve New Yorkers. The sites now pay a licensing fee and 15 percent tax on gross revenues to the state.

In the meantime, Massachusetts lawmakers went a different route. They chose to legalize DFS operations and set a number of regulations. However, there are no taxes and fees associated. The terms of that deal expire in 2018.

In Nevada, DFS operators are being treated just like casinos. They are required to apply for a gambling operators license. So far, no major DFS operators have sought to operate in Nevada.

Other states, like California, have considered legislation regulating and taxing DFS operators, but have yet to pass any laws. California remains the largest market for DFS sites.

The history of online gambling in the United States

The first online casinos started opening up on the internet back in 1994. The operators of these sites were mostly based in places like Antigua and the Isle of Man, but they happily accepted customers from the United States.

By 1996, a First Nations group near Montreal, Quebec, Canada set up a gaming commission and started issuing licenses to online poker and casino sites on North American soil. This group was the Mohawk Territory of Kahnawake and the commission was known as the Kahnawake Gaming Commission.

The number of online gambling websites around the world suddenly ballooned from a handful to hundreds.

By 1998, reports suggested online gambling revenues were upwards of $800 million.

US lawmakers start looking

A year later, the US Senate made its first attempt to ban online gambling, introducing the Internet Gambling Prohibition Act. The bill did not pass.

In 2002, the United States Court of Appeals for the Fifth Circuit ruled the Federal Wire Act prohibits sports betting, but not necessarily online gambling. However, the US Department of Justice disagreed, claiming all online gambling is illegal in the US, and that advertising online gambling is akin to aiding and abetting a crime. In 2004, search engines Google and Yahoo! pulled all online gambling advertising.

The Unlawful Internet Gambling Enforcement Act

In September 2006, the US Congress passed the Unlawful Internet Gambling Enforcement Act (UIGEA) as a part of the SAFE Port Act. The act made it illegal for US banks to process transactions for online gambling sites. President George W. Bush signed the bill into law in October and a number of online gambling operators immediately pulled out of the US market.

However, The online gambling industry kept growing and many operators continued to accept US customers. The offshore operations skirted around the new banking laws in a variety of creative ways. By 2008, market data and intelligence firm H2 Gambling Capital estimated worldwide online gambling revenues had hit $21 billion.

Online Poker’s Black Friday

On April 15, 2011, three of the largest online poker operators in the world were indicted on various charges including violating the UIGEA. These sites included PokerStars, Full Tilt, and Absolute Poker. Access to the sites from the US was shut down and the massive US online poker market was effectively closed. The day became known as Black Friday in the online poker community.

It was ultimately exposed that Full Tilt had failed to segregate player funds and paid out millions in to its owners. A settlement was reached that included PokerStars buying Full Tilt and paying back US players who were left out of pocket.

Weighing in on the Wire Act

In December 2011, the DOJ released a legal opinion that Federal Wire Act only applies to sports bets. This paved the way for individual states to begin to consider online lottery sales, and ultimately online poker and online casino games.

The new legal online gambling market

In the summer of 2012, Delaware became the first state to legalize online gambling, passing the Delaware Gaming Competitiveness Act.

In February 2013, Nevada became the second state to legalize online gambling, authorizing the issue of online poker licenses. Within a week, New Jersey became the third state to legalize online gambling, authorizing the issue of both online poker and online casino licenses to casinos in Atlantic City.

In April 2013, the first legal online gambling site in the United States went live in Nevada. It was an online poker room called Ultimate Poker. By November, online poker and online casinos went live in Delaware and New Jersey.

In 2017, Pennsylvania became the fourth and largest state to pass legislation regulating online gambling. It is in the process of licensing and launching both online casinos and online poker room.

What states might introduce online gambling next?

California

California has considered several pieces of online gambling legislation but has yet to turn any into law. The Assembly was the first legislative body in the country to pass DFS regulation legislation. However, that bill died in the Senate. Online poker also appeared close to passing in 2016, but competing interests, including operators, Native American casinos, California card rooms, and lawmakers failed to find a compromise.

Stakeholders in California’s gambling community have proven they have difficulty finding consensus on a host of issues, including online gambling.

Illinois

Illinois lawmakers have been locked in a protracted battle over gambling expansion initiatives for years. It has at different times both included and excluded online gambling. The state of Illinois appears closer to passing online gambling legislation than ever before. The state got close to passing a bill in 2017, but it never got through both chambers of the state legislature.

Learn more about the opportunity online gambling represents for Illinois here.

Massachusetts

Massachusetts is relatively new to the world of legal and regulated gambling. The state actually fought to keep Native American casinos out for years. It passed the Expanded Gaming Act in 2011, and the state’s first slot parlor opened at Plainridge Park Casino in June 2015. However, the two first sizable commercial casinos, MGM Springfield and Wynn Boston Harbor, remain under construction.

Massachusetts did pass a bill regulating, but not taxing, daily fantasy sports. Of course, that’s likely to change when the deal expires in 2018.

The DFS bill also created The Massachusetts Special Commission on Online Gaming, Fantasy Sports Gaming and Daily Fantasy Sports. The commission explored the idea of regulated online gambling and recommended to state officials that regulated online gambling did have its benefits.

 

New York

New York has had Native American casinos and racetracks with video lottery terminals for decades. At the end of 2016, the first of four new commercial casinos began opening up across the state. The state even went through a year-long legal battle with the DFS industry before settling and passing DFS legislation. However, online gambling legislation has gone through a lengthy process in the state that has yet to prove fruitful.

The latest effort by lawmakers has come in the area of online poker, where the State Senate has passed legislation two years in a row, only to see it largely ignored by the Assembly.

What is also working against New York is that its recently opened commercial casinos are financially struggling. While the perception is unounded, the thought is online casinos would only further saturate the already crowded casino market.