Tennessee Bets $5.5 Billion a Year on Sports and Has No Casino. One Legal Test Explains Both.
There is not a single sportsbook counter anywhere in Tennessee, and bettors there still wagered more than $5.5 billion in a year. The reason sits in an 1834 constitutional clause.
There is not a sportsbook counter anywhere in Tennessee. No betting windows, no screens in a casino bar, no kiosk. Every legal sports bet in the state is placed on a phone, and in the fiscal year that ended in June 2025, those phones handled more than $5.5 billion, according to the state's Sports Wagering Council.
Tennessee also has no casino, and the same clause of its constitution accounts for both facts. The state did not choose online-only betting as a style. It was the version that fit through a gap in a rule written in 1834.
The clause, and the question it leaves open
Article XI, Section 5 of the Tennessee Constitution says the legislature has no power to authorize lotteries. Voters amended it in 2002 to allow a state lottery, whose money funds college scholarships. Nothing in it mentions casinos or sports.
What the clause bans, then, depends on what a lottery is. Tennessee courts have long described one as having three elements: something paid, a prize, and chance. Nearly every form of gambling has the first two, so everything turns on chance.
In December 2018, months after the US Supreme Court cleared the way for states to legalize sports betting, Tennessee's attorney general answered the question directly in Opinion 18-48. Under the "dominant factor" test most courts use, a contest where skill decides the outcome more than chance is not a lottery. Betting on an actual game, the opinion reasoned, could fall on the skill side, the same way courts in many states have treated betting on horse races. If so, the legislature could legalize it with an ordinary law.
A slot machine or a roulette wheel is about as pure a game of chance as exists. A casino is squarely on the other side of the line.
How the law was built to stay on the right side
The Tennessee Sports Gaming Act passed in 2019. Governor Bill Lee, who said he was opposed to gambling, let it become law without his signature, and betting opened in November 2020.
The law allowed online wagering only. There are no licensed retail sportsbooks, which also means there is no building that could one day add a few table games and call itself a casino. Whether or not that was the main intent, it is the effect.
Tennessee also taxes its sportsbooks differently from almost everywhere else. Most states take a share of what the books win. Tennessee takes 1.85% of every dollar wagered, whether the book wins or loses on it. For fiscal 2025 that came to about $103 million.
Where the standard advice is wrong
The standard assumption is that sports betting is the first step and casinos follow, because a state that has accepted one form of gambling will accept the next. In most states that is a reasonable forecast. In Tennessee it gets the legal mechanics backward.
Sports betting did not open the door to casinos here. It went through a door that only exists because casinos are shut out. The argument that made it legal, that skill dominates chance, is exactly the argument a casino cannot make. More sports betting does nothing to wear that line down, and a casino would still need what sports betting never did: a constitutional amendment and a statewide vote.
None has come close to reaching the ballot.
Where Tennesseans actually go
Geography does the rest, and it does not treat the state's cities equally.
Memphis is the easy one. The Tunica casinos across the Mississippi line are close enough for an evening: Hollywood Casino Tunica is about 26 miles from downtown in a straight line, with Horseshoe Tunica nearby. Our Tunica page has the full strip.
East Tennessee looks to North Carolina. Harrah's Cherokee is about 48 miles from Knoxville as the crow flies, though the road through the Smokies makes it feel much farther. From Chattanooga, Harrah's Cherokee Valley River is about 72 miles.
Nashville is the odd one. The nearest full casino is Bally's Evansville in Indiana, about 133 miles away in a straight line, and our Nashville page shows nothing much closer. But Kentucky Downs, just over the state line in Franklin, is about 40 miles up Interstate 65, and its machines play like slots for reasons we explain in our piece on Kentucky's historical horse racing. For a lot of Nashville slot players, the nearest thing to a casino is a racetrack in another state.
Topics
- tennessee
- gambling-law
- legality
- sports-betting
- memphis