2026 State Bans on Sweepstakes Casinos Update: Tennessee on the Doorstep, Minnesota Inches Closer
The crackdown on sweepstakes casinos has slowly spread across the United States over the last year, and now Tennessee is set to become the latest state to enter the mix. Only one other state, Minnesota, could come close in 2026 as it comes down to the wire with just under two weeks left in its legislative session.
As both scenarios play out, this offers a glimpse of what might be coming down the pike from other U.S. states in the future. Many of the brand-name online casinos are pushing to enter more states across the country, but that will come at the expense of these sweepstakes casinos within their borders.
It’s a very tricky (and timely) situation involving sweepstakes casinos in certain U.S. states. Let’s take a look at what’s going on in Tennessee and Minnesota, as well as how these rulings could shape the future of sweepstakes casinos in the country.
Tennessee Could be Closed for Business on Sweepstakes Casinos
The Volunteer State has been moving to shut down sweepstakes casinos over the last few months. Towards the end of 2025, Attorney General Jonathan Skrmetti sent out cease-and-desist letters to over 40 sweeps providers, forcing their hand and offering an olive branch to leave the state. Thus, Senate Bill 2136 (SB 2136) and House Bill 1885 (HB 1885) were introduced to push these providers out.
In March, the Senate got to work and passed SB2136 unanimously (32-0) by labeling it a consumer-protection update to the Tennessee Consumer Protection Act. The bill highlights the dangers and prohibits “online sweepstakes games” that use dual-currency formats to simulate casino, lottery, or sports-betting gameplay.
This bill also gives the Attorney General and the Tennessee Sports Wagering Council additional enforcement tools, which could land sweeps providers trying to operate in the state in trouble with civil penalties, injunctions, and general places you don’t want to be in with the government.
All of that was straightforward, but the House process was anything but. When it reached April 23 (the final day of the legislative session), the lawmakers found themselves in a predicament over the language in the Senate and House bills.
The House rejected the initial conference committee report, as the first vote was a lopsided 67-17 defeat of a bill to ban sweepstakes casinos in Tennessee. After some behind-the-scenes discussions, the language in the bill was altered, flipping the vote from 69-17 in favor of banning sweepstakes casinos to 25-5 in favor of banning them in the final version.
As of May 2026, SB2136 is still on Governor Bill Lee’s desk, and he’ll have 10 days to sign or veto the bill. Should Lee sign the bill, as expected, Tennessee would join Indiana and Maine as the other states to ban sweepstakes casinos this year; the enforcement of the bill would take place immediately. If Lee doesn’t take any action, the bill automatically becomes law in Tennessee.
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Minnesota Close to Banning Sweepstakes Casinos, Time is Running Out
Back on March 17, Senate File 4474 (SF 4474) and companion bill HF 4410 was brought forward by a bipartisan group of senators, led by Jordan Rasmusson, John Marty, Erin Maye Quade, Matt Klein, and Warren Limmer.
The bill was identical to the one other states introduced, prohibiting the operations and advertising of online sweepstakes games that use dual-currency platforms to simulate real casino and sportsbook gameplay.
Since reaching the Senate, the bill has moved along swimmingly, with overwhelming support, passing the Commerce, Judiciary, Finance, State, and Local Government committees.
On April 30, SF 4474 passed the Senate with a commanding 66-3 vote to ban sweepstakes casinos. The bill was read in the House on May 4 and then referred to the Public Safety, Finance, and Policy Committee.
However, the Great Lake State is now in a time crunch, as the legislative session ends on May 18. If the House doesn’t pass its own version or agree with the Senate bill before that deadline, then SF 4474 is no longer eligible to be passed again until 2027.
Minnesota can fast-track this timeline by simply using the Senate’s version of the bill, but that needs to happen immediately. There is plenty of momentum for SF 4474, but it will truly be a last-second play that gets this one into the endzone.
States Already Out on Sweepstakes Casinos
Indiana and Maine led the exodus out of the sweepstakes casino arena in 2026, but they weren’t the first ones to dip out of the party early altogether.
As of May 2026, about 20% of the United States is out entirely on sweepstakes casino games. Everyone who is opposed to sweepstakes casinos basically makes the same arguments: they are an unregulated gambling loophole; they undermine licensed, regulated real-money gaming markets (and tax revenue); and there are concerns about consumer protections, fraud, lack of oversight, and potential exposure to teenagers.
It is certainly an interesting argument, but one of the underlying reasons that sweepstakes casinos are frowned upon is that they take business away from the big-name, branded online and retail casinos and sportsbooks.
Montana became the first U.S. state to have an outright ban when SB 555 was signed in May 2025, turning out the lights on the party for its residents. Next came Connecticut (June 2025), New Jersey (August 2025), and California (October 2025).
Here is a list of the states that do not allow sweepstakes casino platforms:
- California (went into effect on January 1, 2026)
- Connecticut
- Indiana (goes into effect on July 1, 2026)
- Maine (goes into effect on July 1, 2026)
- Michigan
- Montana
- Nevada
- New Jersey
- New York
- Washington
In most of the states listed above, it’s not hard to find a licensed online casino or sportsbook provider. In some of these states (CA, NV, WA), you’ll need to find a retail location, most likely a tribal casino in California and Washington. In contrast, Nevada has essentially everything needed to have a good time gambling.
Looking Ahead to Sweepstakes Casinos in 2027
Adding to the sad times, a few U.S. states could axe sweepstakes casino play in 2027, with Maryland and Mississippi among the most serious of the bunch. As for the other states, there has been:
- Florida – It made some progress with HB 189 in 2026, getting through initial House committees, but couldn’t get it passed before key deadlines.
- Iowa – It granted the Iowa Racing and Gaming Commission outright authority to issue cease-and-desist orders to unregulated sweeps casino operators. House Study Bill 586 was assigned a House subcommittee in March, and nothing relevant has emerged since.
- Maryland – HB 1226 and HB 295 passed with strong force in March 2026 and advanced to their respective Senate committees. A special session, carryover, and general agreement issues could be the only things that stand in the way.
- Mississippi – SB 2104 passed the Senate unanimously this year and had steep fines up to $100,000 for dual-currency sweepstakes casinos. However, the bill died in the House Gaming Committee in early March, making it the second consecutive year that a sweeps ban failed in the state.
- Oklahoma – SB 1589 passed the Senate and advanced through to the committee. It could have a May 18 adjournment, but the bill still lives on and might continue forward in the House.
Conclusion on Legal Trends of Banning Sweepstakes Casinos in the U.S.
The sweeps casino landscape is facing its biggest challenge since exploding onto the scene not too long ago. With Tennessee at the finish line and Minnesota knocking on the door, the entire country could have a blueprint for eliminating these platforms.
It seems like a hard line has been drawn in the sand, and regulators want to make sure they do away with this gambling loophole once and for all. Plenty of states are starting to come around to legalized iGaming markets, looking to protect their licensed operators, tax revenue, and residents' responsible gambling safety practices.
As for bettors in these affected U.S. states, this is the biggest possible problem they could face. Most of these sweepstakes casinos don’t cost much to get in on the action, offering an alternative to the high-stakes gaming elsewhere. Those customers still have some time, but they should be proactive about redeeming Sweeps Coins and getting their money while they can.
Whether you believe the bans are fair or not, it just goes to show how villainized these platforms have become. There is some truth to the unregulated aspect of this gaming platform, but you just want to make sure everyone is on the same page regarding fair gameplay and redemptions.
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