Americans have been placing bets on sporting events for a long time before anyone thought to write a law about it. Horse racing attracted organized wagering in the 1800s. Backroom bookmakers took action on boxing and baseball through most of the 20th century. Nevada legalized sportsbooks in 1949, and for decades, it remained the only state where you could walk up to a counter and put money on a game without breaking the law.

The rest of the country bet anyway, of course, through offshore websites and local bookies who operated in a gray area that everyone knew about and few people discussed openly. What changed over the last 10 years was not the American appetite for sports betting. That was already enormous. What changed was the legal and technical infrastructure that allowed legal sports betting in the U.S. to operate in the open, at scale, through a phone in your pocket.

The Federal Ban That Froze Everything

In 1992, Congress passed the Professional and Amateur Sports Protection Act (PASPA), a federal law that blocked states from authorizing or licensing sports betting. Nevada was grandfathered in. A handful of other states received partial exemptions for existing lottery schemes. Everyone else was locked out.

The law held for over 25 years. During that stretch, the illegal sports betting market grew to tens of billions of dollars annually. States collected nothing from it. Bettors had no consumer protections. Leagues publicly opposed legalization while privately building relationships with data companies and offshore sportsbook operators.

New Jersey challenged the law starting in 2011, and the case eventually reached the Supreme Court. On May 14, 2018, the Court ruled 6 to 3 that the federal ban was unconstitutional. The reasoning rested on the 10th Amendment’s anti-commandeering doctrine, which prevents the federal government from ordering states to enforce or maintain specific regulatory policies. The decision did not legalize sports betting nationwide. It gave each state the authority to decide for itself, opening the door for state-by-state legalization of sports betting.

New Jersey Moves First

Less than a month after the ruling, on June 11, 2018, New Jersey’s Governor Phil Murphy signed a bill permitting sports betting at casinos and racetracks. Online and mobile wagering followed quickly. The state’s proximity to New York City gave it a massive population base, and sportsbook operators rushed to set up operations there.

Other states watched New Jersey’s early revenue numbers closely. The results were strong enough that legislatures across the country started drafting their own bills. Pennsylvania, West Virginia, Indiana, Iowa, and several others authorized sports betting within the first two years, accelerating the growth of legal sports betting across the U.S.

Stretching a Bankroll in a Crowded Market

With 39 states now hosting legal sportsbooks, bettors have more options than ever to compare lines and find value. FanDuel and DraftKings control roughly 74% of the national market by revenue, but smaller operators compete aggressively on pricing and promotions. Shopping odds across multiple books remains one of the simplest ways to protect your money over time.

Sign-up bonuses, free bet offers, and promo codes like the ones on Covers.com give new users extra room to work with when opening accounts. Pairing those incentives with disciplined bankroll management goes further than any single wager.

The Numbers Behind the Growth

Industry data from the American Gaming Association reported $13.71 billion in sports betting revenue for 2024, which represented a 25.4% increase from the prior year. Legal sportsbooks handled close to $150 billion in total wagers, also known as “handle.” Revenue refers to the portion sportsbooks retain after paying out winning bets.

More than 95% of that activity took place through mobile apps and online platforms, not at physical locations. The dominance of mobile betting has been one of the defining drivers behind the rapid expansion of legal sports betting in the U.S.

New York posted the highest figures of any state, generating over $22.5 billion in handle and $2.11 billion in operator revenue during 2024. The state launched mobile betting in January 2022, and its large population combined with a high tax rate made it a focal point for the industry and for state budget discussions alike.

Missouri became the 39th state with a live sports betting market when it launched on December 1, 2025. Washington, D.C. also operates a legal market. As of early 2026, roughly 80% of the U.S. population lives in a state where placing a legal sports bet is possible.

Why Mobile Changed Everything

Physical sportsbooks required travel, usually to Las Vegas or Atlantic City. Mobile betting removed that barrier entirely. A person sitting at home during a football game can open an app, place a bet, and settle it within hours. The convenience factor accelerated adoption at a pace that brick-and-mortar operations could never have matched.

FanDuel and DraftKings had a head start because both companies had spent years building large customer bases through daily fantasy sports contests before the Supreme Court ruling. They already had brand recognition, user data, and marketing infrastructure. FanDuel holds roughly 41% of the national market share by revenue. DraftKings sits at around 33%. Together, those two companies account for nearly three out of every four dollars in sportsbook revenue across the country.

State Revenue and Tax Structures

Each state sets its own tax rate on sportsbook revenue, and the variation is wide. New York taxes mobile sports betting operators at 51%, one of the highest rates in the country. Other states set rates closer to 10% or 15%. These differences affect which operators choose to enter a given market and how aggressively they price their odds.

State governments have used sports betting tax revenue to fund a range of programs, from education to infrastructure. While the total remains small relative to overall state budgets, the contribution from legal sports betting continues to grow as more states come online and existing markets mature.

The Leagues Came Around

Professional sports leagues spent years opposing legalized sports betting in public. They argued it would threaten game integrity. After the Supreme Court ruling, those same leagues signed partnerships with sportsbook operators, integrated betting content into broadcasts, and began selling official data feeds to bookmakers. The NBA, NFL, MLB, and NHL all have formal relationships with betting companies now. League-branded betting segments appear during live broadcasts on major networks.

This reversal happened quickly. Financial incentives played an obvious role, but the broader acceptance of sports betting among fans also reduced the reputational risk that leagues once feared.

What Comes Next

A few large states still do not have legal sports betting, including California and Texas. Both have complicated political environments around gambling legislation, and neither appears likely to pass a bill in the near term. If they do, the revenue impact would be substantial given their population sizes.

Federal regulation remains a possibility as well, though no serious legislation has advanced. The current system of state-by-state oversight creates a patchwork of rules, tax rates, and licensing requirements that operators must manage individually.

The U.S. sports betting market went from a single legal state to 39 in about seven years. Revenue grew from a small base to nearly $14 billion annually. The infrastructure is in place, the customer base is established, and the political resistance that existed for decades has largely faded.

Conclusion: A Structural Shift, Not a Sudden Trend

The rapid expansion of sports betting in the United States was not driven by a sudden change in public interest. It was driven by a structural shift. The repeal of PASPA removed the federal barrier. State legislatures built regulatory frameworks. Mobile technology provided distribution at scale. Established operators leveraged existing customer bases to accelerate adoption.

In less than a decade, legal sports betting in the U.S. transformed from a Nevada monopoly into a nationwide, multi-billion-dollar industry operating across most of the country. The next phase will likely focus on regulatory refinement, tax policy adjustments, market competition, and responsible gaming oversight.

The explosion may have happened quickly, but what remains now is an industry that is deeply integrated into the American sports economy — and still evolving.