Sports Betting’s US History
The legal history of sports betting in the United States is really a story of shifting authority between the federal government and the states. Here's a chronological breakdown.
1. Early America: Gambling Was Mostly a State Issue (1800s–1900s)
For most of U.S. history, gambling regulation was handled by individual states. Sports betting existed largely through:
Illegal bookmakers
Horse-racing wagering (often legal through pari-mutuel systems)
Informal betting pools
By the mid-20th century, concerns about organized crime and corruption in sports led many states to prohibit sports betting.
2. Nevada Becomes the Sports Betting Capital (1949)
In 1949, Nevada legalized sports wagering.
For decades, Nevada's sportsbooks—especially in Las Vegas—were essentially the only large-scale legal sports betting market in the country.
This created a unique situation where Americans could legally bet on sports in Nevada while doing so elsewhere was generally illegal under state law.
3. Federal Concern Grows (1960s–1980s)
Congress passed several anti-gambling laws aimed at organized crime and interstate betting operations, including:
Interstate Wire Act (1961), which prohibited certain interstate transmission of sports wagers.
Other laws targeting illegal gambling businesses and racketeering.
Importantly, these laws did not create a nationwide ban on sports betting itself. They focused largely on interstate operations and criminal enterprises.
4. PASPA: The Federal Sports Betting Ban (1992)
The major turning point came in 1992 when Congress passed the:
Professional and Amateur Sports Protection Act (PASPA), sometimes called the "Bradley Act."
PASPA prohibited states from authorizing or licensing sports betting. States generally could not create new legal sportsbooks. (BettingUSA.com)
Key Exceptions
Several states were grandfathered in:
Nevada
Delaware
Montana
Oregon
Nevada remained the dominant legal sports betting market for the next 25 years. (Encyclopedia Britannica)
5. New Jersey Challenges the Ban (2011–2018)
The challenge that changed everything began in New Jersey.
2011
New Jersey voters approved a constitutional amendment supporting sports betting.
2012
The state enacted legislation allowing sports betting at casinos and racetracks.
Major sports organizations sued:
National Collegiate Athletic Association
National Football League
Major League Baseball
National Basketball Association
National Hockey League
Federal courts initially ruled against New Jersey because PASPA was still valid. (Encyclopedia Britannica)
6. The Supreme Court Decision: Murphy v. NCAA (2018)
On May 14, 2018, the U.S. Supreme Court decided:
Murphy v. National Collegiate Athletic Association
The Court held that PASPA violated the Constitution's anti-commandeering principle because Congress cannot simply order states to maintain particular laws. The Court struck down PASPA. (Encyclopedia Britannica)
Why It Was So Important
The Court did not legalize sports betting nationwide.
Instead, it said:
States can decide for themselves whether sports betting should be legal.
Authority shifted from the federal government back to the states. (Encyclopedia Britannica)
7. Rapid Expansion (2018–Present)
After Murphy, states moved quickly.
Early adopters included:
New Jersey
Delaware
Pennsylvania
West Virginia
Mississippi
Many others followed over the next several years. By the mid-2020s, most U.S. states had legalized some form of sports betting, though rules differ significantly from state to state. (Encyclopedia Britannica)
8. The Modern Era: Mobile Betting and State Regulation
Today's legal framework is primarily state-based.
States decide:
Whether sports betting is legal
Whether mobile wagering is allowed
Tax rates
Licensing requirements
Whether bets on college sports are permitted
For example:
Some states allow fully online betting.
Some permit only in-person sportsbooks.
Others still prohibit sports betting entirely.
The Constitutional Significance
Legally, the most important part of this history isn't gambling itself—it's federalism.
The Supreme Court's ruling in Murphy v. National Collegiate Athletic Association became a major Tenth Amendment and states' rights precedent. The case is now frequently discussed in constitutional law courses as an example of the "anti-commandeering" doctrine, which limits Congress's ability to direct state governments. (Encyclopedia Britannica)
So the legal history of sports betting is ultimately the story of:
State control,
Federal restriction through PASPA,
A constitutional challenge by New Jersey,
And a return to state-by-state regulation after 2018.