Tennessee Governor Bill Lee has enacted new legislation that prohibits online sweepstakes casinos, marking the state as the latest in a series of U.S. regions tightening regulations on casino-style gaming platforms utilizing virtual currencies and promotional methods.
This new law, a combination of Senate Bill 2136 and House Bill 1885, forbids dual-currency sweepstakes platforms that provide games akin to traditional casino gambling, which includes slots, video poker, bingo, lottery-style games, and table games.
With this move, Tennessee becomes the seventh state in the U.S. to ban sweepstakes casino operations, joining the ranks of California, Connecticut, New Jersey, New York, Montana, and Louisiana.
Lawmakers contended that these platforms closely mimic unlicensed real-money gambling activities, despite their use of promotional currencies and virtual coins.
The legislation received extensive bipartisan support, passing through a House subcommittee with an 8-0 vote, the Senate unanimously at 32-0, and the House State and Local Government Committee at 21-0, before securing final approval from the House with a 69-17 vote.
Additionally, the law enhances enforcement capabilities under the Tennessee Consumer Protection Act of 1977, empowering regulators and the attorney general with greater authority to investigate and take action against operators.
Tennessee Attorney General Jonathan Skrmetti has been instrumental in this crackdown, as his office had sent cease-and-desist letters to sweepstakes operators in late 2025, leading several companies to exit the state prior to the formal enactment of the legislation.
Among those that left Tennessee were Chumba Casino, Fortune Coins, Global Poker, Luckyland, and Zula Casino.
“The only certainty with an online sweepstakes casino is that it will take your money,” Skrmetti stated in a December press release, adding that these platforms are crafted to seem legitimate while lacking essential consumer protections.
Governor Lee signed the bill after lawmakers introduced it on May 11, utilizing the full 10-day review period allowed.
While the state still permits regulated online sports betting, it has not moved forward with legislation to allow online casino gaming. No regulated iGaming bills were presented during Tennessee’s 2026 legislative session.
Some industry analysts have cautioned that the lack of a regulated online casino market might drive players towards offshore gambling sites that do not provide U.S. consumer protections.
The nationwide effort to crack down on sweepstakes casinos has intensified since California’s AB 831 came into effect in January 2026. Indiana and Oklahoma are also progressing towards complete bans, while Florida, West Virginia, and Maryland are focusing on regulatory investigations and enforcement actions rather than outright bans.
For Tennessee residents looking for legal online casino gaming, Michigan remains the closest regulated iGaming market. Other states with authorized online casino operations include New Jersey, Pennsylvania, West Virginia, Delaware, Rhode Island, and Connecticut.