Why federal gambling law is thin
Congress has never created a national license, a national register or a national gambling regulator. What exists is a short set of criminal and payment statutes, each written around a narrow target, and one Supreme Court opinion about how far Congress can go in telling states what to do. Nearly every question about whether a particular site may take bets from a particular resident is therefore answered by a state statute and a state regulator, covered on the regulators page.
The summaries below follow the statutory text as published by the Cornell Legal Information Institute and the Court's own printed opinion, all read on November 11, 2026. They describe what the texts say. They are not legal advice, and the statutes carry exceptions and case law that a summary leaves out.
The Wire Act, 18 U.S.C. 1084
The Wire Act applies to a person "engaged in the business of betting or wagering" who knowingly uses a wire communication facility to send bets or wagers, or information that helps place them, on a sporting event or contest across state or national lines. It also covers a wire communication that entitles the recipient to money or credit as a result of bets or wagers. The penalty in subsection (a) is a fine, up to two years in prison, or both.
Three other parts of the section shape how it works in practice:
- Subsection (b) allows transmission for news reporting of sporting events, and allows transmission of betting information from a place where betting on that event is legal into another place where it is also legal.
- Subsection (c) says the section gives no immunity from prosecution under state law.
- Subsection (d) sets up a notice procedure for common carriers: after written notice from a law enforcement agency, a carrier must stop furnishing a facility used to transmit illegal gambling information, and the section protects it from liability for doing so.
The text is built around the business of taking wagers. It does not describe a person who places one.
Illegal Gambling Business Act, 18 U.S.C. 1955
Section 1955 makes it a federal crime to conduct, finance, manage, supervise, direct or own all or part of an illegal gambling business. The penalty is a fine, up to five years in prison, or both. The statute defines the term narrowly, and a business counts only if it meets all three conditions in subsection (b)(1):
- It violates the law of the state or political subdivision where it operates.
- Five or more persons conduct, finance, manage, supervise, direct or own it.
- It has been in substantially continuous operation for more than 30 days, or has a gross revenue of $2,000 in a single day.
The first condition is the one that ties federal law to state law. A business that does not violate the state's own law does not meet the definition. Subsection (e) excludes certain bingo and lottery activity run by tax-exempt organizations and savings promotion raffles. The text speaks to those who run or fund the business and does not mention bettors.
UIGEA, 31 U.S.C. 5361 to 5367
The Unlawful Internet Gambling Enforcement Act works through money. Section 5363 is addressed to a person engaged in the business of betting or wagering and bars that person from knowingly accepting certain payments in connection with another person's participation in unlawful Internet gambling. The covered payments include credit, electronic fund transfers and money transmitting services, checks and similar instruments, and other transactions the Treasury Secretary and the Federal Reserve Board prescribe jointly.
Section 5362 supplies the definitions, and they do much of the work:
- "Unlawful Internet gambling" is placing, receiving or knowingly transmitting a bet or wager using the Internet at least in part, where the bet is unlawful under applicable federal or state law where it is initiated, received or made.
- A bet within a single state is outside the definition when the bet and the method are expressly authorized by that state's law, state law requires age and location verification and appropriate data security, and the bet does not violate the Interstate Horseracing Act, the Professional and Amateur Sports Protection Act, the Gambling Devices Transportation Act or the Indian Gaming Regulatory Act.
- The definition of a bet excludes some activity, among them participation in a game where players risk nothing of value beyond their personal efforts or access to the Internet, or free points or credits usable only within the sponsor's games, and qualifying fantasy and simulation sports.
UIGEA does not itself declare any form of gambling lawful or unlawful. It borrows the answer from other federal and state law, which is why the state map still decides the question.
Murphy v. NCAA and the end of PASPA
The Professional and Amateur Sports Protection Act of 1992 made it unlawful for a state to "sponsor, operate, advertise, promote, license, or authorize by law or compact" a sports betting scheme, with civil enforcement by the Attorney General and sports organizations. As the Court noted, PASPA did not make sports gambling itself a federal crime.
New Jersey repealed parts of its sports betting prohibitions, the leagues sued, and the case reached the Supreme Court. On May 14, 2018, in an opinion by Justice Alito for the Court, the Court held that PASPA's provision barring state authorization of sports gambling violates the anticommandeering rule and that no other PASPA provision could be severed. The Third Circuit's judgment was reversed.
The opinion makes a point that applies well beyond sports. In its words, Congress "can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own." The state-by-state results appear in the sports betting states list.
What is not federal law
None of the four sources creates a federal gambling license or a federal body that approves operators. Several points follow from the texts:
- Whether an online casino may operate in a state is a state decision. Seven states license online casino play, as counted on the state status page.
- Licensing happens state by state, so any list of license holders comes from a state regulator, not from a federal body.
- The federal statutes mostly assume state law as the baseline and add penalties for businesses and payment flows on top of it.
- Sweepstakes casinos, which hold no state license, are tested under state law, and the federal texts do not make them licensed. See are sweepstakes casinos legal.
- Offshore license claims are not federal licenses either. The offshore casinos section explains how those claims are checked.
Frequently asked questions
Is there a federal online casino license?
No. None of the statutes read here issues one, and Murphy leaves the choice to regulate to Congress or, if Congress does not, to each state.
Does the Wire Act ban all online gambling?
The text covers transmission of bets or wagering information on sporting events or contests by a person in the betting business, and it contains the exceptions in subsection (b). Its words do not extend to every form of online gambling.
Does UIGEA make online gambling illegal?
UIGEA restricts how a gambling business accepts payments for bets that are unlawful under other law. It does not itself make a bet lawful or unlawful.
Did Murphy legalize sports betting?
The decision struck down the federal bar on state authorization. It left each state to decide whether to authorize betting, which is why a state's own statute and regulator are the sources to read.