A State-by-State Look

In this article I want to address a burning question I get all the time: Are sweepstakes casinos actually legal in the United States? As someone who’s spent plenty of time digging into this topic, I can confidently say yes – in most places, they are legal, though with a few important caveats. Let’s walk through how these sweepstakes casinos operate within the law and take a state-by-state peek at where things stand.

Table of Content:

• How it works
• Legal - but exceptions
• State by state
• Final thoughts

How Sweepstakes Casinos Skirt Gambling Laws

First, it helps to understand what makes a sweepstakes casino different from a regular online casino. Traditional online gambling for real money is only legal in a handful of states (currently just 7 states offer regulated iGaming like slots or poker). Sweepstakes casinos, on the other hand, found a creative workaround: they use a “no purchase necessary” sweepstakes model with virtual coins.

You usually get Gold Coins (play money) and Sweeps Coins (sweepstakes entries that can be redeemed for cash prizes). Because you can get Sweeps Coins for free (via giveaways, mail-in offers, etc.), playing with them is legally treated as participating in a sweepstakes contest rather than wagering in illegal gambling.

This dual-currency system is how sweepstakes casinos avoid gambling laws. As long as they offer a free method of entry (which they all do), they’re generally classified as sweepstakes, not gambling. That loophole has enabled them to operate in the vast majority of U.S. states.

In fact, when I first learned about this model, I was sceptical – it sounded too good to be true. But digging into the legal framework, I realized it’s quite ingenious: by strictly adhering to sweepstakes regulations (like no purchase necessary and using prizes instead of direct cash bets), these sites have made themselves lawful in over 40 states.

See our restricted states tool to see which sweepstakes are legal in your state.

Legal in Most States – With Notable Exceptions

Even though sweepstakes casinos are still legal in most of the USA, a state-by-state look reveals some are less welcoming.

Here’s the rundown:

• Completely Banned States: A few states have put their foot down and explicitly banned sweepstakes casino platforms. Currently, Washington, Idaho, Connecticut, Montana, and New Jersey fall in this category. Washington State has long prohibited online sweepstakes gambling under its strict gambling laws. Idaho allows free-play games but does not allow prize redemptions (so Sweeps Coins can’t be cashed out there, effectively banning the key part of the model). In 2025, both Montana and Connecticut passed new laws to ban sweepstakes casinos. And most recently, New Jersey’s governor signed a ban into law – making sweeps casinos (including poker) illegal in the Garden State. These states are basically no-go zones: if you live there, reputable sweepstakes sites won’t let you redeem prizes (and often block play entirely).

• States with Partial Restrictions: A handful of states allow sweepstakes casinos to operate but impose certain limitations. For example, Florida and New York permit sweeps play but cap the maximum prize that can be won in a single sweepstakes at $5,000. If you somehow hit a huge jackpot above that, it’s void above the cap. (This is due to state laws aimed at keeping these games “promotional” by limiting prize values.) Louisiana is another interesting case – there is no explicit law banning sweeps casinos statewide (in fact, the governor vetoed a ban bill), but the state’s gaming board and Attorney General have aggressively issued cease-and-desist orders to sweeps operators. So, many major platforms pulled out of Louisiana voluntarily. Nevada technically could allow sweepstakes casinos (since they’re not real-money gambling), but in practice nearly all operators avoid Nevada – likely because Nevada regulators don’t look kindly on unlicensed gambling of any sort in the casino capital. A few other states – like Maryland, Ohio, Illinois, Massachusetts – have seen legislative attempts to regulate or ban sweeps casinos (more on that next), so some operators tread carefully or exited just to be safe.

• Fully Legal (for Now) States: The good news is that 40+ states currently have sweepstakes casinos available with no sweeping bans in effect. This includes big states like California and Texas and many others where you can play at sweeps casinos without issue. In these states, all major operators (Chumba, LuckyLand, Stake.us, etc.) accept players, and you can legally redeem prizes. It truly spans coast to coast – from Alabama to Alaska, most jurisdictions allow the sweepstakes model as of today.

Of course, this is a fast-evolving landscape. Throughout 2024 and 2025, a wave of bills popped up in various states aiming to crack down on sweepstakes gaming. Many failed (e.g. proposed bans in Arkansas, Texas, Florida, and Maryland died in committee or missed legislative deadlines). A few succeeded, as mentioned (CT, MT, NJ bans in 2025). Others are pending – California is debating a ban bill backed by tribal casinos, and New York’s legislature passed a ban that was awaiting the governor’s signature. So, while sweeps casinos are widely legal right now, there’s definitely a spotlight on them. Regulators and lawmakers are asking: Are these just unregulated casinos in disguise? The industry is responding by tightening up compliance and forming associations to explain its legality.

State-by-State Highlights

To give you a clear picture, let me highlight some specific states:

• Texas, California, Florida – Huge markets where sweepstakes casinos thrive under current law. They have dozens of sites active. (Florida has that $5k prize limit as noted, but otherwise it’s a large and active market.

• New York – A big state in flux. Sweeps casinos were operating (with the $5k prize cap) and legal until mid-2025, when the Attorney General sent cease-and-desist letters to many operators, forcing about 90% of platforms out. On top of that, the legislature passed a ban bill in 2025. If that gets signed, New Yorkers will be in the same boat as folks in WA or NJ – unable to play. It shows how quickly things can change if states decide they want to fold up the sweeps loophole.

• Michigan & Delaware – These states stand out because they have regulated online casinos and seem to consider sweepstakes sites unauthorized competitors. Michigan’s Gaming Control Board issued orders against some sweeps operators, effectively pushing them out (sweeps casinos are considered banned in MI now). Delaware, similarly, is treated as a restricted state by many platforms (likely because DE has its own online casino games via the lottery). So even if not explicitly illegal by statute, sweeps sites typically don’t operate in MI or DE – keep that in mind if you’re a resident there.

• Washington – As mentioned, Washington State has one of the strictest gambling prohibitions. It’s essentially the one place from day one that no sweepstakes casino dared to serve. If you’re in WA, unfortunately you’re out of luck – none of the big sites will accept you (and doing so would be unlawful under WA law).

In summary, sweepstakes casinos are legal in the majority of U.S. states, providing a casino-style experience under sweepstakes rules. All 50 states have sweepstakes/contest laws, and as long as a platform complies with those (free entry, etc.), it’s generally allowed. Right now about 45 states plus D.C. have at least one sweeps platform active. Only a handful (5-6 states) truly ban them. That being said, the patchwork is changing. It’s wise to stay updated on your state’s latest regulations. I always advise checking the terms of the specific sweeps casino – they usually list which states are eligible. If your state isn’t on the exclusion list, you’re good to play!

Final Thoughts on Legality

I’ve come to appreciate that these casinos didn’t become so popular by accident – they purpose-built their model to be legal. The companies behind them often have compliance lawyers ensuring every promotion and coin giveaway adheres to sweepstakes law. From my perspective, if you live in a state where traditional online casinos are banned (which is most states), these sweeps sites are a legitimate alternative. They offer real prizes without technically being “gambling.” The legal reality is reflected in their ubiquity – by 2025, Americans across 47 or so states could play at sweepstakes casinos, which is incredible coverage.

Of course, always use common sense: stick to well-known, reputable sweepstakes casinos that clearly explain their free entry methods and rules. The sites I use (like Stake.us and Fortune Coins) make their legal disclosures very visible. If an operator is shady about how their sweepstakes works, that’s a red flag. But the top sweeps casinos have nothing to hide; they’re thriving precisely because they operate within the bounds of the law.

So, yes, sweepstakes casinos really are legal for most Americans. They’ve opened up a world of online slots, poker, and casino fun to people in states that otherwise couldn’t enjoy real-money gaming. Just be mindful of the few states that have banned or restricted them. I hope this state-by-state overview helped clear the air! Now that we know it’s legit to play, you might be wondering how to actually cash in those Sweeps Coins for prizes – don’t worry, I’ve got you covered on that in another guide. Happy (and legal) gaming!