Yes, sports betting is illegal in California. Penal Code Section 337a criminalizes bookmaking, accepting wagers on sporting events, and placing bets with unauthorized operators, with a first offense punishable by up to a year in county jail or state prison and a fine up to $5,000.1California Legislative Information. California Penal Code 337a The one narrow exception is parimutuel wagering on horse racing. Voters rejected two legalization measures in 2022, and no new proposal has reached the ballot since.
What Penal Code 337a Actually Covers
Section 337a reaches both sides of an illegal sports wager. It prohibits running a bookmaking operation, keeping a place for recording bets, and accepting sports wagers, and it also prohibits placing bets with unlicensed operators. The statute reaches wagers made “for gain, hire, reward, or gratuitously,” which on its face includes even no-profit bets between friends.1California Legislative Information. California Penal Code 337a
The prohibition sits inside a broader constitutional structure. Article IV, Section 19 of the California Constitution authorizes only a limited set of gambling activities: the state lottery, horse racing, tribal card games under compacts, charitable bingo, and nonprofit raffles. Anything outside those categories requires a constitutional amendment, and an amendment requires a vote of the people.2Justia Law. California Constitution Article IV Section 19 The legislature cannot legalize sports betting on its own.
Why California Hasn’t Followed the Other States
The federal ban on state-authorized sports betting fell in 2018 when the U.S. Supreme Court decided Murphy v. NCAA.3Supreme Court of the United States. Murphy v. National Collegiate Athletic Assn. More than 30 states have legalized some form of sports wagering since. California has not.
Two competing measures went to California voters in November 2022. Proposition 26 would have allowed in-person sports betting at tribal casinos and horse racetracks. Proposition 27 would have opened mobile sports betting statewide through licensed commercial operators like DraftKings and FanDuel. Both lost badly. Prop 26 failed roughly 67% to 33%. Prop 27 failed about 82% to 18%, despite hundreds of millions in industry spending. Tribes and national sportsbook operators spent much of the campaign attacking each other, and the flood of advertising appears to have pushed voters toward rejecting both.
The One Legal Way to Bet on Sports
Horse racing is the only sport Californians can legally bet on. Advance deposit wagering (ADW) providers licensed by the California Horse Racing Board let you fund an account and place parimutuel bets by phone or computer on races held in California and elsewhere. Age and location are verified before wagers are accepted.4California Legislative Information. California Business and Professions Code 19604
That is the entire universe of legal, state-sanctioned sports wagering in California. Tribal casinos, licensed cardrooms, and the state lottery each operate under their own rules, and none of them include sports betting.
Office Pools, Home Games, and Daily Fantasy
California carves out a specific exception for casual card games. Penal Code Section 337j excludes card games played in private homes where no one profits from running the game.5California Legislative Information. California Penal Code 337j A kitchen-table poker night with no house rake is fine.
Sports wagers get no such safe harbor. Because Section 337a reaches wagers made “gratuitously,” a friendly Super Bowl squares pool at the office technically violates the statute. Law enforcement does not, in practice, pursue small social bets between friends, but the reader should know the exception for private card games does not extend to sports.
Daily fantasy sports sits in a similarly uncomfortable spot. In Opinion No. 23-1001, the California Attorney General concluded that DFS contests where players pick athlete lineups and pay entry fees are wagers on sporting events prohibited by Section 337a.6Office of the Attorney General. Opinion No. 23-1001 – Legality of Daily Fantasy Sports Games The AG rejected the industry’s “game of skill” argument, reasoning that DFS players are wagering on the athletic performance of others regardless of how much research goes into their picks. DFS operators have continued to accept California players since the opinion, creating a gap between the stated law and current enforcement.
Offshore Sportsbooks Carry Real Risk
With no legal in-state option, some California residents bet through offshore websites. Those sites operate outside U.S. jurisdiction and hold no state license. Using them violates Section 337a on the bettor’s side, and it exposes the bettor to problems that go beyond the criminal statute.
An offshore book that refuses to pay winnings is not answerable to any U.S. regulator. There is no complaint process and no legal recourse to collect. The FBI has publicly warned that unregulated offshore sites put bettors at risk of losing both deposits and winnings, and that dealing with illegal bookmakers can expose customers to extortion, violence over unpaid debts, and money laundering exposure.7Federal Bureau of Investigation. Great Odds, High Risk – The FBI Encourages U.S. Bettors to Know the Risks of Illegal Gambling
Federal law adds friction on the money side. The Unlawful Internet Gambling Enforcement Act prohibits banks and payment processors from handling transactions tied to illegal online gambling.8Office of the Law Revision Counsel. 31 USC Chapter 53 Subchapter IV – Prohibition on Funding of Unlawful Internet Gambling Deposits and withdrawals to offshore sportsbooks can be blocked, reversed, or frozen.
Criminal Penalties
Section 337a is a wobbler. Prosecutors can charge it as either a misdemeanor or a felony depending on the facts. For a first offense, the maximum is one year in county jail or state prison, a fine up to $5,000, or both.1California Legislative Information. California Penal Code 337a
Prior convictions raise the stakes:
- With one prior conviction, up to one year in county jail and a mandatory fine of at least $1,000 and up to $10,000. Courts cannot waive the fine entirely, even when granting probation.
- With two or more prior convictions, up to one year in county jail, a fine of $1,000 to $15,000, or both. The mandatory minimum fine still applies.
Operators face harder treatment than individual bettors. Someone running an illegal book is more likely to see felony charges and state prison exposure; someone who placed a single bet is more likely to see misdemeanor treatment or no charges at all. Both are technically within the reach of the statute.
Large operations that take bets across state lines also face federal prosecution under the Wire Act, which makes it a crime to use wire communications to transmit bets or wagering information in interstate commerce. The federal maximum is two years in prison plus fines.9Office of the Law Revision Counsel. 18 USC 1084 – Transmission of Wagering Information; Penalties
Winnings Are Still Taxable
Federal tax law does not care whether gambling income came from a legal source. Winnings from an illegal wager are reportable, and failing to report them creates a separate problem stacked on top of the underlying offense.
For 2026, the W-2G reporting threshold rose to $2,000, up from $600, after an inflation adjustment. A gambling operator must file Form W-2G when winnings hit that threshold and are at least 300 times the wager. For sports wagers, when winnings exceed $5,000 and meet the 300-to-1 ratio, the operator must withhold 24% for federal income taxes.10IRS. Instructions for Forms W-2G and 5754 (Rev. January 2026)
California taxes gambling winnings as income. You can deduct gambling losses against winnings, but starting with tax year 2026, the state limits that deduction to 90% of your winnings. On $10,000 won and $10,000 lost, you still owe California tax on $1,000 of net gambling income.11Franchise Tax Board. Deductions Keep dated records of wagers, wins, and losses.
Where Legalization Stands
Legalizing sports betting in California requires a constitutional amendment approved by voters. As of early 2026, no sports betting initiative has been certified for the ballot, though preliminary proposals are circulating. Some of those explore a framework in which tribes would control the market while partnering with commercial operators for technology and mobile platforms.
The core obstacle is the same one that sank Props 26 and 27: tribal gaming interests, commercial sportsbook operators, and the legislature have not agreed on a single framework to put before voters. Until they do, sports betting remains a crime in California, and the only legal way to wager on a sporting event is a parimutuel bet on a horse race.