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Tennessee Governor Bill Lee has signed legislation banning online sweepstakes casinos, making the state the latest in a growing number of U.S. jurisdictions cracking down on casino-style gaming platforms that use virtual currencies and promotional systems.
The new law, combining Senate Bill 2136 and House Bill 1885, prohibits dual-currency sweepstakes platforms offering games resembling traditional casino gambling, including slots, video poker, bingo, lottery-style games, and table games.
Tennessee became the seventh U.S. state to prohibit sweepstakes casino operations, joining California, Connecticut, New Jersey, New York, Montana, and Louisiana.
Lawmakers argued that the platforms closely resemble unlicensed real-money gambling operations despite their use of promotional currencies and virtual coins.
The legislation passed with broad bipartisan support, clearing a House subcommittee by an 8-0 vote, the Senate by 32-0 and the House State and Local Government Committee by 21-0 before final House approval by a 69-17 margin.
The law also expands enforcement powers under the Tennessee Consumer Protection Act of 1977, giving regulators and the attorney general broader authority to investigate and prosecute operators.
Tennessee Attorney General Jonathan Skrmetti played a central role in the crackdown after his office issued cease-and-desist letters to sweepstakes operators in late 2025, prompting several companies to leave the state before the legislation was formally enacted.
Operators that exited Tennessee included Chumba Casino, Fortune Coins, Global Poker, Luckyland, and Zula Casino, among others.
“The only thing you can be sure about with an online sweepstakes casino is that it’s going to take your money,” Skrmetti said in a December news release. He also said the platforms were designed to appear legitimate while operating without meaningful consumer protections.
Governor Lee signed the legislation after lawmakers presented the bill on May 11, using the full 10-day review period available to him.
The state continues to permit regulated online sports betting but has not advanced legislation to authorize online casino gaming. No regulated iGaming bills were introduced during Tennessee’s 2026 legislative session.
Some industry observers warned that the absence of a regulated online casino market could push players toward offshore gambling sites that lack U.S. consumer safeguards.
The broader U.S. crackdown on sweepstakes casinos has accelerated since California’s AB 831 took effect in January 2026. Indiana and Oklahoma have also moved toward full bans, while Florida, West Virginia, and Maryland have pursued regulatory investigations and enforcement pressure rather than outright prohibitions.
For Tennessee residents seeking legal online casino gaming, Michigan remains the nearest regulated iGaming market. Other states with regulated online casino operations include New Jersey, Pennsylvania, West Virginia, Delaware, Rhode Island, and Connecticut.