Is online gambling legal in Tennessee? Only sports betting is, and that makes Tennessee one of the easiest states to misread. It was the first US state to legalize online-only sports betting, its sportsbook market moves billions of dollars a year, and every major national brand is live there. So it is natural to assume the rest of iGaming is coming. It isn’t. Casino games are banned by the state constitution itself, and in 2026 Tennessee went further and outlawed sweepstakes casinos too.
The short answer: online gambling is legal in Tennessee only for sports betting with a state-licensed sportsbook, daily fantasy sports and online lottery draw games. Real-money online casinos, online poker and sweepstakes casinos are illegal. There is no casino license to apply for, and changing that would take a constitutional amendment approved by two separate legislatures and then by voters.
This guide covers what is legal right now, what it costs to operate legally, why casinos are off the table until at least 2030, and where each type of iGaming business stands. For how Tennessee compares with other states, see our state-by-state guide to US gambling laws.
Is online gambling legal in Tennessee at all?
Yes, but only three kinds. Here is the full picture as of October 2026.
| Product | Status (Oct 2026) | Minimum age | Regulator / legal basis |
|---|---|---|---|
| Online sports betting | Legal, licensed operators only | 21 | Sports Wagering Council (SWC), Tennessee Sports Gaming Act (2019) |
| Retail sportsbooks and kiosks | Not allowed | n/a | Online-only by statute |
| Daily fantasy sports | Legal, licensed | 18 | SWC (since July 1, 2023), Fantasy Sports Act (2016) |
| Lottery | Legal, including draw games in the official app | 18 | Tennessee Education Lottery |
| Private sports pools (e.g. bracket pools) | Allowed if the total pool is under $1,000 and entry is $25 or less | n/a | SWC guidance |
| Charitable gaming | Limited annual events for approved nonprofits | Varies | Constitution, Article XI, Section 5 |
| Online casino (slots, table games, live dealer) | Illegal | n/a | Banned by the constitution |
| Online poker | Illegal | n/a | No licensing path |
| Land-based casinos | Illegal | n/a | Banned by the constitution; no tribal casinos |
| Sweepstakes casinos (dual currency) | Illegal | n/a | SB 2136, signed May 22, 2026 |
| Prediction markets (sports contracts) | Contested; state winning so far | n/a | Sixth Circuit ruled for Tennessee, September 25, 2026 |
| Offshore sportsbooks and casinos | Illegal | n/a | Gambling statutes, TCA 39-17-501 et seq. |
Are online casinos legal in Tennessee? No, and the constitution is why
Most state guides stop at “online casinos aren’t legal yet,” which makes it sound like a bill could fix it next session. In Tennessee, it can’t.
Article XI, Section 5 of the Tennessee Constitution bars the legislature from authorizing lotteries, with exceptions for the state lottery and limited charitable events, and it goes on to name games of chance associated with casinos, including slot machines and roulette wheels, as off-limits. That wording covers the games themselves, so it applies whether the slot machine sits on a casino floor or runs on a phone. Online poker has no licensing path either.
That is also why sports betting got through when casinos didn’t. In Opinion 18-48 (December 2018), the state Attorney General applied the “dominant factor” test and concluded that the legislature could legalize betting on single sporting events by statute, because skill predominates over chance. The same opinion flagged that chance-heavy products, such as multi-game parlays, look more like a lottery. Casino games were never part of that analysis. They don’t need one; the constitution already names them.
How long would it take to change?
Under Tennessee’s amendment process, a resolution must pass one General Assembly by a majority, then pass the next General Assembly by two-thirds, and then go to voters at the next governor’s election. To pass, it needs more yes than no votes, and the yes votes must also exceed half of all votes cast in the governor’s race, according to the Tennessee Secretary of State.
Here is the fastest realistic path, assuming a casino resolution is filed and passes in the very next session:
| Step | Earliest window |
|---|---|
| Majority vote, 115th General Assembly | 2027 to 2028 |
| Two-thirds vote, 116th General Assembly | 2029 to 2030 |
| Voter approval at the governor’s election | November 2030 |
| Enabling law, regulations and licensing | 2031 at the earliest |
And that is the optimistic case. Past casino resolutions, such as Rep. Larry Miller’s proposal to delete the casino language, have not advanced, and nothing on casinos or iGaming moved in the 2026 session. The state’s political energy in 2026 went the other way: banning sweepstakes and fighting prediction markets. If you are planning a US iGaming roadmap, Tennessee belongs in the “not this decade” column for casino products.
Can you bet online in Tennessee? Is DraftKings or FanDuel legal?
Yes. Sports betting has been legal since the Tennessee Sports Gaming Act took effect in 2019, without the governor’s signature, and the market launched on November 1, 2020. Tennessee is still an online-only state: there are no retail sportsbooks or betting kiosks, and none are planned. Bettors must be in Tennessee when they bet, but they don’t have to live there.
The Sports Wagering Council’s licensee list shows nine licensed operators:
| Brand | Licensed entity |
|---|---|
| BetMGM | BetMGM, LLC |
| Bally Bet | Bally’s Interactive, LLC |
| bet365 | Hillside (Tennessee) LLC |
| Caesars Sportsbook | American Wagering, Inc. |
| DraftKings | Crown TN Gaming LLC |
| Fanatics Sportsbook | FBG Enterprises Opco, LLC |
| FanDuel Sportsbook | Betfair Interactive US LLC |
| Hard Rock Bet | Seminole Hard Rock Digital, LLC |
| theScore Bet | Penn Sports Interactive, LLC |
So yes, DraftKings (through Crown TN Gaming LLC) and FanDuel (through Betfair Interactive US LLC) are both licensed and legal in Tennessee, along with BetMGM and six others. Some guides, and some AI answers, put the count at 11 or 12. The regulator’s own list says nine. If a brand isn’t on that list, the SWC is clear that betting with it in Tennessee is illegal, and an advertisement does not mean a sportsbook is licensed.
The rules every licensed sportsbook works under
- Age 21+, and the bettor must be physically in Tennessee, verified by geolocation. Proxy betting is illegal, even with permission.
- No high school sports. In-game proposition bets on college events are also prohibited under the Sports Gaming Act, and college markets in general are tighter than in most states, so check the SWC’s current approved-events list before building a college product.
- No credit card deposits.
- Statewide self-exclusion through the SWC, on top of each operator’s own tools.
- Player complaints: a bettor first files a grievance with the operator within 30 days, then can escalate to the SWC within 30 days of the operator’s decision.
- No mandatory hold. The original rule forcing books to hold at least 10% of wagers was removed by SB 475 in 2023. Several well-ranked guides still list it as a current requirement.
What it costs to operate: licence fees
From the SWC’s operator fee schedule and vendor fee page:
| Licence type | Fee | Term |
|---|---|---|
| Sportsbook operator, initial | $750,000 (includes the $50,000 non-refundable application fee) | Annual |
| Sportsbook operator, renewal | $750,000 if prior-year wagers were $100M or more; $375,000 if below | Annual |
| Vendor, first licence (all types) | $150,000, paid $50,000 a year | Three years |
| Vendor renewal: geolocation, platform, account management | $150,000 | Three years |
| Vendor renewal: risk management, oddsmaking, sports data | $75,000 | Three years |
| Vendor renewal: independent testing labs | $45,000 | Three years |
| Vendor renewal: KYC, payments, direct platform interface | $30,000 | Three years |
Two things suppliers often miss. First, every vendor pays the full $150,000 for its first three-year term; the lower tiers only apply at renewal. Second, the SWC lists more than 55 approved vendors and registrants, so a new KYC or payments supplier is entering a crowded field.
The handle tax, and what it really costs
Tennessee was the first state to tax sports betting on handle rather than revenue. Since July 1, 2023, the privilege tax is 1.85% of gross handle (total wagers, adjusted only for voided or cancelled bets and the federal excise tax), replacing the old 20% tax on adjusted gross revenue. The same 2023 law (SB 475) also bars operators from deducting promotional wagers, so free bets count toward the taxable handle. Because the tax no longer depends on payouts, the SWC stopped publishing monthly payout and revenue figures.
A handle tax hits hardest when your hold is low. Here is what 1.85% of handle works out to as a share of gross revenue at different hold rates:
| Your hold | Tax on $100M handle | Gross revenue | Effective tax on revenue |
|---|---|---|---|
| 6% | $1.85M | $6.0M | 30.8% |
| 7% | $1.85M | $7.0M | 26.4% |
| 9.2% (2025 market average) | $1.85M | $9.2M | 20.1% |
| 12% | $1.85M | $12.0M | 15.4% |
The 9.2% row uses 2025 market figures reported by Legal Sports Report: about $5.87 billion in handle, $538 million in revenue and $107.6 million in tax, an effective rate of roughly 20%. The takeaway for operators: parlay-heavy, high-hold books do well under this model, while sharp-friendly, low-margin books pay far more than the headline rate suggests. Because promos are taxed as handle, an aggressive bonus strategy costs more in Tennessee than in a GGR-tax state.
How big is the market?
Large and still growing. The SWC’s July 2026 report shows about $410.2 million in gross handle and $7.59 million in privilege tax for the month, and the monthly record of about $456 million was set in June 2026, helped by World Cup betting. Full-year 2025 tax came to $107.6 million.
Is PrizePicks or Underdog legal in Tennessee?
Yes. Daily fantasy sports have been legal since the 2016 Fantasy Sports Act, and the SWC took over regulation from the Secretary of State on July 1, 2023. The Council lists 16 fantasy licensees. The minimum age is 18, three years younger than sports betting, so KYC flows have to handle two age thresholds in one state. PrizePicks states that Tennessee users can’t include college sports in Player Pick lineups.
Are sweepstakes casinos legal in Tennessee? Banned in 2026
This is the biggest change most Tennessee pages haven’t caught up on, and some of them still recommend sweepstakes or “social” casinos to Tennessee readers.
It happened in two steps:
- December 29, 2025: Attorney General Jonathan Skrmetti sent cease-and-desist letters to nearly 40 online sweepstakes casinos, citing the constitution’s lottery ban plus state gambling and consumer protection law. Recipients either blocked Tennessee or committed to exit dates, though the brands kept operating in other states. Covers named Chumba, Modo, McLuck, High 5 Casino, Stake, NoLimitCoins and Crown Coins among those leaving.
- May 22, 2026: Gov. Bill Lee signed SB 2136, effective immediately. It brings games, contests or promotions using a virtual, dual or multi-currency system into the definition of gambling, covering slot simulations, video poker, table games, bingo and unlicensed sports wagering. The House passed the conference version 69-17 and the Senate 25-5.
Two details matter for businesses. The law makes the operation, conducting or promotion of online sweepstakes games unlawful, so affiliates and media buyers are exposed, not just operators. And violations are treated as breaches of the Tennessee Consumer Protection Act of 1977, which gives the Attorney General civil enforcement powers on top of criminal gambling law. Licensed sports betting, the lottery and fantasy sports are exempt.
Pure free-to-play social games, where nothing can be redeemed for cash or prizes, are a different product. But any model that lets players buy currency and redeem winnings is now squarely inside the ban. To see which states still allow the model, check our sweepstakes casino legality tracker by state.
Is Kalshi legal in Tennessee? Prediction markets and the Sixth Circuit
In January 2026 the SWC ordered prediction market platforms including Kalshi and Polymarket to stop offering sports contracts in the state. Kalshi sued, arguing federal commodities law preempts state gambling rules, and won a preliminary injunction in the Middle District of Tennessee. On September 25, 2026, a unanimous Sixth Circuit panel sided with Tennessee and Ohio, vacating that injunction. The court held that Kalshi had not shown its sports event contracts are “swaps” under the Commodity Exchange Act, so the CFTC’s exclusive jurisdiction does not shield them from state gambling law.
The ruling covers sports event contracts only, not contracts tied to interest rates, currencies or similar financial outcomes. It is the second federal appeals court to side with state regulators, after the Ninth Circuit in the Nevada case, while the Third Circuit went the other way in New Jersey. That split makes a Supreme Court review likely, and New Jersey has already petitioned the Court. For the bigger picture, see our explainer on how prediction markets work and why states are fighting them and our iGaming regulation news roundup.
What happens to offshore sites?
Some of the top-ranking “Tennessee online casino” pages recommend offshore casinos licensed in Curaçao or Anjouan as a workaround. That is not a gray area in Tennessee.
- The SWC states that betting with an unlicensed sportsbook is a criminal offense, that being able to reach a website does not make a wager legal, and that no regulator can help a player recover funds from an unlicensed site.
- Under TCA 39-17-501 et seq., gambling is a Class C misdemeanor, promoting gambling a Class B misdemeanor, and financing, owning or supervising a gambling enterprise a Class E felony.
- The Attorney General has shown, with the sweepstakes campaign, that it will go after operators with no physical presence in the state.
For affiliates, the risk is concentrated: sending Tennessee traffic to offshore casinos or sweepstakes sites can fall under “promoting” in both the gambling statutes and SB 2136. Our guide to whether offshore sports betting is legal in the US covers the federal side.
How old do you have to be to gamble in Tennessee?
Tennessee runs two legal age thresholds side by side: 21 for sports betting and 18 for fantasy sports and the lottery.
| Activity | Minimum age | Notes |
|---|---|---|
| Online sports betting | 21 | Must be physically in Tennessee, verified by geolocation |
| Daily fantasy sports | 18 | Licensed by the SWC since July 1, 2023 |
| Tennessee Education Lottery | 18 | Includes draw games in the official app |
| Charitable gaming | Varies | Limited annual events for approved nonprofits |
| Sweepstakes casinos | Now illegal (SB 2136) | No legal product at any age since May 22, 2026 |
For KYC teams, that means two thresholds in one state (18 for DFS, 21 for betting), so an operator running both products needs separate age gates rather than a single state-level rule.
Who carries the risk in Tennessee: an exposure map by business role
| Your role | Legal path | Exposure | Practical move |
|---|---|---|---|
| Online sportsbook not yet in Tennessee | Yes, direct SWC licence (no partner needed) | Low if licensed | Model the handle tax against your expected hold before budgeting the $750,000 fee |
| Licensed sportsbook | Yes | Low | Price promos as taxable handle; keep college markets within SWC guidance |
| DFS operator | Yes, SWC fantasy licence | Low if licensed | Support 18+ for DFS alongside 21+ for betting; check college restrictions |
| Online casino or poker operator | No | High | Geofence Tennessee; nothing to apply for before 2031 at the earliest |
| Sweepstakes casino operator | No | High | Block Tennessee; SB 2136 is already in force |
| Prediction market | Federal only, and contested | High after the Sixth Circuit ruling | Treat sports contracts as blocked in Tennessee; track any Supreme Court review |
| Platform, geolocation, data or odds supplier | Yes, SWC vendor licence | Low | Budget $150,000 over the first three years regardless of tier |
| KYC and payment providers | Yes, SWC vendor licence | Low | Block credit card deposits; handle split ages in one state |
| Affiliates and media buyers | Yes, for licensed sportsbooks and DFS | High for offshore or sweepstakes traffic | Remove Tennessee from sweepstakes and offshore casino campaigns |
The pattern is simple. Tennessee is open for sports betting and fantasy, run through one regulator with clear fees, and closed to everything that looks like a casino. Unlike states that tolerate gray products while they debate, Tennessee has spent 2026 actively removing them.
What to watch next
- Kalshi v. Tennessee: further proceedings after the Sixth Circuit ruling, and whether the Supreme Court takes up the circuit split.
- SB 2136 enforcement: the first Consumer Protection Act actions will show how far “promotion” reaches into affiliate marketing.
- College betting bills: SB 1831 and HB 1768, filed in January 2026, proposed campus geofencing and game-day restrictions. Expect similar proposals in 2027.
- Any casino resolution in 2027: without one, the 2030 ballot is already out of reach.
What this means for you
If you are looking at Tennessee, the realistic options are a sportsbook licence, a fantasy licence, or supplying the operators who hold them. Online casino, poker and sweepstakes are closed by the constitution and by a law signed this year, and the Attorney General has shown he will enforce both.
For the licensing work, compare iGaming law firms and licensing consultants with US state experience, or review KYC and compliance providers that support geolocation and split-age checks. If you are building a book from scratch, start with how to start a sportsbook. For nearby markets, see our guides to gambling laws in Kentucky and Georgia.
This article is general information and analysis, not legal advice. Check current positions with qualified Tennessee counsel before making decisions.
