The tale of online casinos in the US is a dizzying one. We’ve come a long way from the shady internet poker rooms of the ‘90s and have arrived at sleek apps we can open wherever we go. But playing games on an online casino app isn’t as straightforward as browsing social media or streaming a movie on Netflix, which is why online casinos are only legal in seven states. This fact alone may come as a surprise, given that its sister industry, sports betting, is legal in 38 states and the District of Columbia.
Online gambling has a much rougher history than sports betting, no thanks to its early challenges and crackdowns, such as the Unlawful Internet Gambling Enforcement Act of 2006. The gambling industry relies heavily on financial transactions, so when this act made that process essentially impossible, plenty of businesses withdrew from the market and gave up on that dream. While today you can find online American casinos that accept PayPal, that type of security and convenience wasn’t always the case.
Although a few states pioneered the legalization of online casinos in the early 2010s, the others lagged much further behind, starting a boom a couple of years later in 2019. Let’s take a deep dive into the seven states that are leading the legal online casino movement.
New Jersey
The Garden State was one of the first states to legalize online casinos — but it also sparked a significant move by the U.S. Department of Justice in 2011. After seeing the potential of legal online casinos in American society, the Department decided to reevaluate the Wire Act of 1961. New Jersey is also famous for its resort city, Atlantic City, often termed the Las Vegas of the East, which could have been a significant driver of the legalization of online gambling. Chris Christie, the former governor, passed the Casino Control Act, which let the casinos in Atlantic City offer online variants of their games to players within the state.
Pennsylvania
Although online casinos haven’t even been legal in Pennsylvania for a decade, the state is second to Nevada when it comes to commercial casino revenues. As Nevada is the historical home of gambling in the United States, that’s saying a lot. Pennsylvania has had a history of using gambling revenues for good, whether it’s to boost the overall economy, recover from financial deficits, or create more jobs. Its first project was the PA state lottery, which existed to provide property tax relief to the elderly. After this bill was passed, there were ongoing efforts to establish casinos in the ‘80s and ‘90s despite the anxieties surrounding gambling at the time.
Connecticut
Connecticut is the second most recent state to legalize online casino gambling, having done so in 2021. Currently, gamblers are limited to two online casinos: DraftKings Casino and FanDuel’s Mohegan Sun Casino. Since both casino partners, the Mashantucket Pequot Tribe and the Mohegan Tribe were given master licenses, no other online casinos are permitted to operate in the state. Despite their young age in Connecticut, these casinos generated around $33.7 million in 2024. Seeing as the tribes are responsible for overseeing gaming activity, they are obligated to use any revenue to promote economic development on their respective reservations, donate to charity, and fund tribal government programs.
Delaware
Delaware residents have enjoyed online casinos since 2012, as it was the first state to legalize online casinos. All three online casinos in the state are operated through BetRivers by in-person racetrack casinos Delaware Park, Harrington Raceway and Casino, and Dover Downs. The issue with Delaware’s structure is that its casino sites are very homogeneous, offering exactly the same selection of games. That’s because they are only allowed to source their games from the Delaware Lottery, making for a narrow selection. So, although the state was a trailblazer in the industry, it’s not a competitive or vibrant one for online gambling.
Michigan
After a serious legislative struggle, Michigan fought long and hard to legalize online casinos. Eventually, online casinos, poker, sports betting, and horse racing betting became fully regulated. Two essential laws were passed in 2019, including the Lawful Internet Gaming Act. It outlined how regulated internet gaming was in the best interest of the state and its residents, and, therefore, it was important to implement a fair and secure system. Each casino operator can operate under two brands, one for casino games and the other for poker.
West Virginia
West Virginia followed a classic path in its gambling history. It started with the legalization of horse and greyhound racing and a state lottery and then went on to tackle the regulation of online activities. At first, the state seemed unlikely to legalize online gambling because it’s such a small state with a conservative background. It also had a poor regulatory environment, which made it appear less ready to transition. Despite the challenges, it surprised the nation by going full force.
Rhode Island
Rhode Island is the most recent state to legalize online casinos. The moment that lawmakers voted to approve the new bill it was sent to the governor’s desk for him to give the final okay. With just hours left before the deadline, he finally signed up for online casino games to go live in April 2024. Unlike other states, this law essentially extends Bally’s current monopoly over gambling in the state to online casinos, meaning the company’s online subsidiary operates all online casinos. Because everything is so new in the state, we’ll have to see how this new change pans out.
Ruby Stauffer is a prominent technology blogger known for her insightful analysis and in-depth reviews of the latest tech trends and gadgets. Her blog has become a go-to resource for tech enthusiasts seeking reliable information and expert opinions on the ever-evolving world of technology.