History of Gambling in the United States

The history of gambling in United States dates back to before the country appeared even on the map when Cristopher Columbus mistaking the Bahamas as a sea route to India.

Today, we will take a hard look at the history of gambling in the US starting with this first landmark event – which took place in 1492 and led to the discovery of the New World.

Of course, Columbus couldn’t have known this as he was poked and shot at with bow and arrows on more occasions he would actually care to share. Yet, the love for gambling has been an essential part of North America tribal culture.

We will take a journey from those days of old to the Las Vegas we know today. Let’s get started.

How Did Gambling Start in America?

Precolonial America was a fun place to be. The tribes dominated vast swathes of land and they had all forms of entertainment.

One of those was games of chances, which were played at various celebrations for hundreds of years before Europeans stumbled across North America and decided they wanted a piece of it.

The tribes had their ingenuine way to test the fates. One popular game at the time was played with a bowl, stones and bones. Each stone and bone had different markings and participants tried to achieve various combinations by throwing these marked pieces into the bowl.

All wagers had to be placed beforehand so everything was kept fair and square. The game was called hubbub by the Pequot Indians and it caused quite the stir.

Image of Old Stick Dice Game
Image of Stick Dice

Other alterations of stones-and-bones game existed, although records are not quite clear.

And so, you can call this the origins of gambling in America.

Naturally, things wouldn’t stop here!

European colonialists brought over a variety of card and table games, and even the bulky roulette wheel to completely transform the gambling landscape in the colonies and later the United States.

Colonial Time in Gambling

Things were quiet before the 1600s when Europeans began knocking on the tribes’ backdoor and colonies started sprouting up.

Englishmen began to arrive in droves. Their influence started spreading and skirmishes erupted with the locals. However, in the interim between flare-ups, Europeans were looking at all sorts of way to relax.

It was around that time contests such as cock fighting, bull baiting and horse racing began to appear. In the case of bull baiting, a bull would be put in a ring to fight off dogs, trained specifically to bite but not kill the bull.

And so, locals got their kicks from how many dogs the bull would kill before collapsing, or eventually clearing the whole pack.

Praise the Mighty Dollar: Lotteries Are Introduced

Short of having fun, rulers, such as King James I, found a reason to leverage their subjects’ proclivities for gambling and finance the development of infrastructure in these new lands.

So, the king issued a decree introducing the first lottery in Jamestown, Virginia – the British settlement that would serve as base of operation for further expansion.

The lottery idea appeared a delight and other colonies quickly picked up the practice, funding roadworks, healthcare, and new settlements further out in the west.

Of course, not everyone was hot on the idea with Pilgrims and Puritans bent on the idea that they were doing God’s work.

image of William Hogarth's the gaming house
Image of William Hogarth – The Gaming House (
1735)

Religious opposition against all forms of gambling was steadfast. On the one hand, Europe gave America a lot of spiritually-minded men and women.

On the other, the old world gave rise to a whole lot of games, including the roulette wheel attributed to French mathematician Blaise Pascal (1632 – 1662).

British aristocrats were doing pretty well and many gave in to various games of chance, raking up huge debts and losing whole country estates, along with any other precious belongings.

Then Queen Anne (1665 – 1714) came around and decided to alleviate the pain of so many gamblers from the nobility, rendering huge debts unenforceable.

During the 1700s colonialists thought it was high time to stand one’s moral ground firmly. The period of the Great Awakening commenced in a bid to clamp down on social vices, including ‘all kinds of cock games, especially all horse racing, exhibitions of shews,’ and anything that can lead to a lowly existence.

This doctrine showed remarkable prescience at the time as it may have come under the form of a moral and religious appeal. However, the Articles of Association clearly stated that the main purpose of the decision was to spur the economy.

Keeping the Social Order in the 19th Century

Colonies did have their mixed opinions of gambling. On the one hand, enforcing strict rules would have been silly, as no local government had the manpower to keep track.

Besides, the judicial system wasn’t ideal at the time and the United States was experiencing its own internal cataclysms related to the economy.

Still, the Queen Anne decree was passed in several states, to name Georgia, South Carolina and Virginia, making sure that people wouldn’t gamble away their livelihoods.

New Orleans also stepped up its measures to limit the reach of gambling, outlawing activities in public spaces, but once again – tolerated it in private settings, providing such gatherings didn’t disrupt public order.

The Mississippi River, in the meantime, proved quite the elusive venue and gamblers flocked to the newly-built river boats to gamble. Riverboat casinos thrived until the Civil War arrived in 1861, ravishing the country and polarizing the South against the North.

Civil War, Pennsylvania Cavalry
Image of the Pennsylvania Cavalry in the Civil War

Lotteries Plagued by Corruption and Fraud

While lotteries promised to solve many of the issues related to funding the public purse, there were quite a few drawbacks. This became ever more evident as the country drew closer to the war.

Kentucky and Missouri were among the first two states to fully legalize their lotteries. Once the war washed over, Louisiana introduced ‘the Great Serpent,’ in 1868 a new and popular lottery, which people participated in as it proved the only way out of a stark existence.

However, rampant corruption defrauded participants from any fair competition, leading to the eventual outlawing of the lottery in 1895.

Gambling continued in the West at the time where cowboys set out to lead interesting lives. One of the most prominent cases at the time was the murder of Wild Bill Hickok, a notable figure in the West who explored new lands and helped establish permanent settlements.

He was shot during a game of poker because he had a hand of two black aces and two black eights, which – quite aptly at that – was called ‘the dead man’s hand.

Yes, tempers were quick in that age.

The end of the 19th century was a turning point for the country as well, as gambling fell out of grace and became the preserve of criminal organizations.

The Beginning of Modern Gambling in the US

The United States did a complete turn around starting in the 1900s. One after another, local governments outlawing gambling. Oklahoma, New Mexico and Arizona enforced public prohibition as soon as they became states.

Nevada deemed gambling illegal in 1910 and horse racing was banned in New York. Maryland and Kentucky remained the only states where residents could legally place wagers on the outcome of horse races.

For the next 20 or so years things remained quiet, but then Nevada decided that the time of gambling had come once again.

In 1931, the Silver State made local gambling legal, allowing the Golden Gate Casino to start operating again. Established in 1906, the Golden Gate Casino was in fact the first such establishment in the United States.

Nevada would then split between Reno and Las Vegas, with the former catering to cowboys and wanderers in the North whereas the City of Sin would rapidly shape up as the future hub in the U.S.

El Rancho Vegas would open in 1941 at what is today known as the Las Vegas Strip, becoming one of the first big establishments of modern dimensions. Criminal organizations also had their hands in all sorts of gambling enterprises.

El Rancho Las Vegas, 1940s
Image of El Rancho Vegas 1940’s

After the prohibition era ended, the Mob had a lot of money to invest and Benjamin “Bugsy” Siegel was dispatched to Nevada, looking for opportunities to launder the money and establish legal businesses.

Bugsy was impressed with the gambling Mecca and decided to invest millions in a high-end hotel and casino, The Flamingo. Originally, he hoped the venue would attract entertainers and high rollers, but his plans come pitifully short.

Siegel was killed by fellow mobsters in 1947.

Howard Hughes Valiant Resistance

In the 1960s, the mob had already spread its root in Las Vegas trying to corner every lucrative business. Mafiosi didn’t quite run things themselves, but hired businessmen to do their bidding while they used other means to get ahead of the competition – or eliminate it altogether.

Image of Howard Hughes 1938
Image of Howard Hughes 1938

One person who came under the heavy hits of organized crime was Howard Hughes, the owner of the Hughes Aircraft Company and a reputable inventor. Having invested heavily in Las Vegas all throughout the 1940s and the 1960s, Hughes decided to buy the Desert Inn Casino & Hotel on the Strip.

He then expanded into Sands, Frontier, Castaways, and other properties, quickly establishing a heavy presence in the states. Of course, mobsters tried to overtake his business using the good-old intimidation tactics.

However, Hughes wasn’t alone in his fight against organized crime and Nevada officials passed laws in 1967 preventing gangsters from participating in the casino business. Establishing clear regulatory norms has helped gambling establishments to largely keep criminal incursions at bay.

The Return of the Lotteries

With the country generally looking down on gambling and sports betting – perhaps more out of habit than anything else – lotteries began making their return. All throughout the 1970s, different state-run appeared across the United States.

This prompted lawmakers to be even more vigilant of illicit gambling activities, as such operations would have bitten in the tax penny the state received. Delaware, Massachusetts, New Jersey, Ohio, Rhode Island and many other states restored their lotteries.

In 1988, Iowa, Kansas, Oregon, Rhode Island, and West Virginia introduced the first multi-state lottery in an attempt to boost engagement, prize pools and ultimately the tax collected.

Gambling in the 21st Century

Meanwhile, sports betting continued to spread unchecked leading to the passage of the Professional and Amateur Sports Protection Act of 1992 designed to restrict illegal sports gambling. The Act was mostly prompted by the spreading of the offshore gambling industry estimated at $1.5 billion today.

PASPA hit the entire country at a time when no legal sports betting was officially recognized. A few exclusions existed, though, with Oregon, Delaware and Montana exempt from the Act and Nevada still able to conduct licensed sports pools.

Today, there are 19 states that have legalized sports betting within their borders. Of course, the big question has always been to save business and jobs by keeping online gambling at bay. However, online gambling has also turned out to be the biggest driver of revenue.

Currently, the United States is focused on fully legalizing sports betting, with Pennsylvania, New Jersey, and Delaware offering some online options all for good measure.

This about concludes our history of gambling in the United States, but make no mistake – the parts are still moving.

Poker and online casinos have been put on the backburner as the U.S. is headed for becoming one of the largest sports betting markets.