The structure of sports-betting law in the United States contains an interesting asymmetry. Nevada was grandfathered into the Professional and Amateur Sports Protection Act of 1992, which means Nevada could keep its sports books while all other states were forbidden from authorizing betting. This is the kind of rule that invites a legal challenge. It invites it because it is, on its face, indefensible as coherent policy.
PASPA passed with minimal fanfare in 1992. The stated goal was to protect the integrity of sports by limiting gambling access. The mechanism was a federal ban: except for grandfathered Nevada and a handful of other specific jurisdictions, states could not authorize sports betting. Thirty years later, this became the law that overturned itself.
The legal challenge came from New Jersey in 2014. Governor Chris Christie had campaigned on allowing sports betting. The legislature passed enabling legislation. The NFL and other leagues sued. The case went through federal courts and eventually reached the Supreme Court. The timeline matters. First: New Jersey proposes betting in 2014. Second: case moves through courts until 2018. Third: Supreme Court rules on May 14, 2018.
The Mechanics of the Ruling
The Supreme Court case was Murphy v. National Collegiate Athletic Association (Murphy v. NCAA). The Court's logic was surprisingly straightforward. The Tenth Amendment reserves powers to the states that are not delegated to the federal government. PASPA attempted to prevent states from authorizing betting. This was not a regulation of gambling itself (which would be fine under the Commerce Clause). It was a prohibition on states regulating gambling. That exceeded federal power.
Chief Justice John Roberts wrote the majority opinion. The language is clean. PASPA had been trying to regulate state legislatures, not individuals or entities. You cannot use federal law to tell states what laws they can pass. Therefore PASPA was unconstitutional.
The vote was 6-3. Justice Alito wrote in dissent that the decision would damage sports integrity. Justices Gorsuch and Breyer agreed. But the majority held. The law was struck down entirely. Overnight, any state that wanted to authorize sports betting could do so. No federal prohibition remained.
The Immediate Aftermath
New Jersey legalized sports betting in June 2018, immediately after the ruling. Other states followed rapidly. By 2024, 37 states had authorized sports betting in some form. The speed of adoption is notable. The infrastructure already existed (sportsbooks knew how to operate). The regulatory frameworks were ready (Nevada had been running for decades). The only barrier had been the federal law.
The economic impact was immediate and measurable. Total sports-betting handle (the amount wagered) reached $217.7 billion in 2023 across all US markets. Nevada's share dropped from nearly 100% to roughly 3-4%. States like New York, New Jersey, and Illinois saw explosive growth in tax revenue. The federal government never attempted to reinstate a gambling ban.
There are interesting subquestions embedded in the ruling. Sports integrity was the stated concern. Has sports integrity degraded since 2018? The academic evidence is mixed. The number of integrity incidents reported to the leagues (games allegedly fixed or influenced by gamblers) has not increased. Simultaneously, leagues have invested far more in surveillance and detection. It is unclear whether no increase means no degradation or merely better detection.
The Structural Question
The interesting analytical point is about federalism. The Supreme Court did not say gambling was good. It said that if you are going to ban something, the federal government must do it consistently, not selectively. The fact that Nevada was exempted made the law look like protectionism. The Court fixed this not by extending the ban but by removing it.
This is one of those rare moments where legal structure and economic incentive aligned perfectly. States wanted revenue. The Constitution, as interpreted by the Court, allowed it. The result was rapid transformation. Professional and college sports betting went from prohibited to ubiquitous in six years.
The strangest part of PASPA was not that it failed. It was that it lasted 26 years despite being built on a fundamentally weaker legal foundation than anyone anticipated.
