Online sports betting is not legal in Texas. No sportsbook, mobile app, or website holds a state license to accept sports wagers from anyone inside Texas, and the state’s gambling statute reaches both the operators and the individual placing the bet. The U.S. Supreme Court cleared the path for states to authorize sports betting in 2018, but Texas has not passed legislation to do so, and there is no active regulatory framework, no licensing process, and no consumer protection covering bets placed through unauthorized platforms.1Supreme Court of the United States. Murphy v National Collegiate Athletic Assn
What Texas Law Says About Placing a Bet
Texas Penal Code Chapter 47 is the state’s gambling statute, and it applies to the bettor, not just the bookmaker. Under Section 47.02, you commit an offense by betting on the outcome of a game or contest, or on how a participant performs.2State of Texas. Texas Penal Code Section 47.02 – Gambling A “bet” is defined as an agreement to win or lose something of value based at least partly on chance, and placing a wager through an app or website fits squarely inside that definition.
For the bettor, the offense is a Class C misdemeanor. That carries a maximum fine of $500 and no jail time.3State of Texas. Texas Penal Code Section 12.23 – Class C Misdemeanor Individual bettors are rarely charged, but the violation exists on the books, and enforcement priorities can change.
The penalties for anyone running the operation are heavier. Section 47.03 makes it a Class A misdemeanor to promote gambling, and Section 47.05 separately targets anyone who knowingly shares betting odds or provides equipment used to transmit gambling information. Both carry up to one year in jail and fines up to $4,000.4Texas.gov. Texas Penal Code Chapter 47 – Gambling
One narrow defense exists, and it is worth flagging so you don’t misread its scope. Section 47.02(b) protects a bet made in a private place where nobody received any economic benefit beyond their own winnings and the odds were the same for everyone except for skill or luck.2State of Texas. Texas Penal Code Section 47.02 – Gambling A friendly poker game at someone’s house can qualify. A bet placed through a sportsbook cannot, because the operator always takes a cut.
Daily Fantasy Sports
DraftKings, FanDuel, and similar daily fantasy platforms still take entries from Texans. Their argument is that lineup selection is a skill contest, not a bet, and therefore falls outside Chapter 47.
The Texas Attorney General reached the opposite conclusion. Opinion KP-0057, issued in 2016, found that participation in paid fantasy sports contests likely constitutes illegal gambling.5Texas Legislature Online. 88th Legislature HB 2142 – Bill Analysis That opinion has never been tested in court, and no prosecution has forced the major platforms out. A bill in the 88th Legislature (HB 2142) tried to resolve the ambiguity by revising the definition of “bet” to exclude fantasy contests, and it did not become law.
So DFS sits in a gray area. The apps still work, the platforms clearly aren’t worried, and participants could theoretically face a Class C misdemeanor if the state ever decided to enforce the AG’s reading. Nothing has moved in that direction, but the uncertainty is real.
Sweepstakes and Social Casinos
A growing set of online “sweepstakes casinos” market to Texans by structuring their offering around a virtual currency and free-play promotions rather than direct wagers for cash. The pitch is that this model avoids at least one of the three elements Texas gambling law looks for: consideration, prize, and chance.
No Texas statute expressly permits or bans the sweepstakes model, which puts it in the same kind of gray zone as DFS. The Texas Senate advanced SB 517 during the 89th Legislature, targeting illegal gaming machines and proposing new definitions for “gambling devices” and “a thing of value” that could potentially reach sweepstakes platforms. The eventual impact on the online model is not clear. Treat these sites with care: no Texas regulator is ensuring your deposits are protected, and the legal ground can shift.
Offshore Sportsbooks and Why They’re a Bad Bet
When people can’t find a legal option locally, they often turn to offshore sportsbooks that operate from outside the United States. Two problems come with that choice.
The first is state criminal exposure. Placing a wager through an offshore site still violates Section 47.02. The operator’s location doesn’t change the analysis for the bettor. Prosecutions of individual bettors are rare, but the violation is a real one.
The second, and more common, headache is the money. The Unlawful Internet Gambling Enforcement Act of 2006, implemented through Regulation GG, requires U.S. financial institutions to establish written policies to identify and block transactions connected to unlawful internet gambling.6eCFR. 12 CFR Part 233 – Prohibition on Funding of Unlawful Internet Gambling That covers credit card networks, bank wires, ACH, and money transmitters. Your bank can freeze or reject a deposit to an offshore sportsbook without warning, and the same scrutiny applies on withdrawals. The regulation shields the bank from liability when it blocks the transaction, so the incentive runs toward blocking.
Beyond that, offshore sites give you no consumer protection. There is no Texas regulator to complain to, no requirement that the operator segregate your funds, and no legal recourse if the site simply refuses to pay out.
Crossing Into a State Where It Is Legal
Some Texans drive across the border to bet in states that have legalized mobile sports betting. Louisiana is the common example: it allows mobile sports betting in parishes that have approved it, and the requirement is that you be physically located within an approved parish when you place the wager. Residency isn’t required.7Louisiana State Legislature. Louisiana Revised Statutes 27:608 – Limitations on Wagering
The location check is strict. Licensed sportsbook apps rely on geolocation systems built into your phone’s operating system to confirm you are inside the legal jurisdiction before accepting a wager, and those systems detect VPNs and spoofing tools. You have to actually be in the other state, and once you cross back into Texas the app stops taking bets until you return.
Taxes on Any Winnings
If you do win, whether legally in another state or through fantasy sports, the IRS treats those winnings as fully taxable income. You are required to report them on your federal return regardless of the amount.8Internal Revenue Service. Topic No. 419 – Gambling Income and Losses
For 2026, operators must issue a Form W-2G for certain winnings at or above $2,000, a threshold that now adjusts annually for inflation. If your winnings minus your wager exceed $5,000 and the payout is at least 300 times the amount wagered, the operator must withhold federal income tax at 24%.9Internal Revenue Service. Instructions for Forms W-2G and 5754 Even when no W-2G is issued and nothing is withheld, you still owe tax on every dollar of gambling profit. Losses can be deducted against winnings only if you itemize, and only up to the amount you report as winnings.
When This Could Change
Legalizing sports betting in Texas requires a constitutional amendment, which means any bill needs a two-thirds vote in both chambers before it can even reach voters as a ballot measure. Recent efforts have not cleared that bar.
During the 88th Legislature in 2023, a sports betting measure passed the House with 101 votes, barely making the two-thirds threshold, and then stalled in the Senate. The 89th Legislature produced new proposals, including HJR 134, a constitutional amendment that would authorize the legislature to legalize wagering on certain sporting events. As of early 2025 the bill had been referred to the House State Affairs Committee and had not advanced.10Texas Legislature Online. History for 89th Legislature HJR 134
The head count has gotten harder, not easier. More than a dozen House Republicans who replaced pro-gambling lawmakers publicly opposed any expansion of gambling during the current session, a net loss from the 2023 coalition. Lt. Gov. Dan Patrick, who controls the Senate floor and holds office until January 2027, has repeatedly said there is minimal Senate Republican support for expanding gambling. Even optimistic timelines do not put legal sports betting in Texas before 2028, and that assumes a meaningful shift in either legislative composition or political will.