By Vinay Nagpure Student of Maharashtra National Law University, Nagpur
WE, THE PEOPLE OF INDIA, having solemnly resolved to constitute India as a SOVEREIGN, SOCIALIST, SECULAR, DEMOCRATIC REPUBLIC, have adopted the Constitution of India.
India’s ascent is mirrored by its march towards democratic nationhood and technological development. In the global gaming business, an important question is how India should regulate gaming, gambling and the rapidly developing online gaming industry.
The gaming industry in India is changing quickly. Because smartphones are widely used and internet connectivity has become increasingly accessible, online and mobile gaming has grown substantially throughout the country. India has one of the world’s largest gaming communities. According to the FICCI-EY 2024 report, India had more than 450 million online gamers in 2023, with approximately 100 million playing daily. EY estimated that the number of online gamers could reach 491 million in 2024.
The growth of gaming has also created an important legal distinction between games of skill, games of chance and games involving monetary stakes. In Dr. K.R. Lakshmanan v. State of Tamil Nadu, the Supreme Court considered the distinction between games of skill and games of chance and held that horse racing involved a substantial degree of skill. The Court explained the principle in terms of whether skill predominates over chance. However, the legal position concerning online money games has subsequently changed significantly because Parliament enacted the Promotion and Regulation of Online Gaming Act, 2025.
Game-related law is not limited to the question of skill or financial losses. The gaming industry also involves intellectual property, taxation, consumer protection, advertising, information technology, financial transactions and data protection. With the enactment of the Promotion and Regulation of Online Gaming Act, 2025, online gaming is now subject to a central statutory framework dealing specifically with online games.
In the colonial period, the Public Gambling Act, 1867 was enacted to provide for the punishment of public gambling and the keeping of common gaming houses in specified territories. The Act was enacted long before the development of computers, smartphones and the internet and therefore did not specifically address online gaming.
BRITISHER’S ERUDITION OF THE PUBLIC GAMBLING ACT, 1867 (“PGA”)
During the colonial period, the Public Gambling Act, 1867 was enacted with the purpose of providing for the punishment of public gambling and the keeping of common gaming houses in the territories to which it applied. The Act contains provisions concerning gaming houses, persons found in gaming houses and certain forms of public gambling.
The Act was designed for a very different technological environment. Internet gaming, mobile applications, online casinos and digital payment systems did not exist when the legislation was enacted. Consequently, the Public Gambling Act, 1867 cannot by itself be treated as a comprehensive law regulating modern online gaming.
Historically, Indian gambling law developed largely through State legislation and different States adopted different approaches to gaming and gambling. The constitutional position also remains important because “betting and gambling” is included in Entry 34 of the State List in the Seventh Schedule to the Constitution of India.
However, the legal position concerning online money games has changed with the enactment of the Promotion and Regulation of Online Gaming Act, 2025. The Act specifically prohibits online money games and online money gaming services and also prohibits related advertising and certain financial transactions.
The new framework therefore represents an important transition from an earlier system largely based on State gambling laws and judicial distinctions between games of skill and chance towards a specific central statutory framework for online gaming.
SORTS OF THE GAMBLING
One of the oldest forms of entertainment and gaming in India is gambling, while the modern online gaming market has developed into a significant part of the country’s digital economy. There are several forms of gaming and gambling such as physical gambling and sports betting, online gaming and gambling, casinos, lotteries, fantasy sports, and horse racing.
However, it is important to distinguish between gaming and gambling. Not every game is gambling, and the legal treatment of a particular activity depends upon the applicable legislation and the nature of the activity.
1. Physical Gambling & Sports Betting
In India, gambling has traditionally been regulated primarily through State laws. The Public Gambling Act, 1867 continues to form the basis of gambling legislation in certain jurisdictions, while several States have enacted their own gambling laws.
Some examples of State gambling legislation include the Assam Game and Betting Act, 1970, the Bombay Prevention of Gambling Act, 1887, the Goa, Daman and Diu Public Gambling Act, 1976, and provisions concerning gaming under the Karnataka Police Act, 1963.
The precise legal position differs from State to State, and therefore it is not correct to assume that an activity permitted in one State is necessarily permitted in another.
Sports betting is also subject to the applicable gambling laws and other legal provisions. The legality of a particular form of betting must therefore be determined according to the relevant jurisdiction and legislation.
2. Online Gambling and Online Gaming
Online gambling is commonly understood as wagering or staking money or other value through an internet-based platform. It may include activities such as online betting, poker, casino-style games and other games involving monetary stakes.
However, India’s legal framework has undergone a major change.
The Promotion and Regulation of Online Gaming Act, 2025 defines and regulates online gaming and specifically prohibits online money games. Section 5 of the Act provides for the prohibition of online money games and online money gaming services. Sections 6 and 7 also address advertising of online money games and transfer of funds in relation to such games.
The Act does not prohibit every form of online game. It provides for the recognition and promotion of e-sports and the recognition and development of online social games.
Therefore, the statement that all online gaming is prohibited in India would be incorrect. The legal distinction now lies in the statutory classification of the particular online activity.
3. Casinos
A casino is a place where people can participate in games involving wagering or monetary stakes and may have an opportunity to win money or other prizes.
Casino regulation in India has historically been governed by State-specific legislation. Goa, Daman and Diu and Sikkim have specific legal frameworks permitting certain forms of casino gaming subject to licensing and statutory conditions.
The legal position concerning casinos should therefore be examined according to the relevant State legislation and the nature of the particular activity.
4. Lotteries
Lotteries are a form of gaming in which prizes are distributed by lot or chance to persons participating in the scheme.
In India, lotteries are specifically regulated by the Lotteries (Regulation) Act, 1998. The Act provides that no State Government shall organise, conduct or promote a lottery except in accordance with the conditions prescribed under Section 4.
The Act provides several conditions for a State lottery, including requirements concerning the printing and sale of tickets, the conduct of draws and the location of the draw.
The original reference to Section 294A of the Indian Penal Code, 1860 also requires updating. Since the criminal-law framework changed with the enactment of the Bharatiya Nyaya Sanhita, 2023, an article published today should not reproduce Section 294A IPC as though the IPC remains the current general penal statute.
The regulation of lotteries is primarily governed by the Lotteries (Regulation) Act, 1998, together with applicable State laws and rules.
5. Daily Fantasy Sports
Daily fantasy sports became one of the most discussed areas of Indian gaming law because of the question of whether fantasy sports constitute games of skill or games of chance.
Platforms historically argued that success in fantasy sports depends upon users applying knowledge, judgment and skill in selecting players and constructing teams.
However, the legal position must now be considered in light of the Promotion and Regulation of Online Gaming Act, 2025.
The earlier judicial distinction between games of skill and games of chance remains important in understanding the development of Indian gaming law. For example, K.R. Lakshmanan v. State of Tamil Nadu recognised horse racing as involving substantial skill. But the 2025 central legislation specifically prohibits online money games, meaning that the previous skill-versus-chance distinction cannot simply be relied upon to conclude that an online money game is lawful today.
This is one of the most important changes that must be understood when discussing the present legal position of fantasy gaming in India.
6. Horse Racing
In the case of Dr. K.R. Lakshmanan v. State of Tamil Nadu, reported as AIR 1996 SC 1153, the Supreme Court considered horse racing and held that it involved a substantial degree of skill.
The Court observed that horse racing involves factors such as the horse’s inherent capacity, training, fitness, the jockey’s abilities and other factors that can be assessed through knowledge, study and observation. The Court therefore distinguished horse racing from games that are purely based on chance.
However, this decision should not be misunderstood as creating a general exemption from every modern gaming regulation. The judgment concerned the legal framework applicable at that time, whereas the present regulation of online money gaming is also governed by the Promotion and Regulation of Online Gaming Act, 2025.
Horse racing, therefore, continues to require examination under the applicable legal framework governing betting, racing and gaming in the relevant jurisdiction.
THE NEW LEGAL FRAMEWORK FOR ONLINE GAMING IN INDIA
The legal landscape of online gaming in India underwent a major transformation with the enactment of the Promotion and Regulation of Online Gaming Act, 2025 (Act No. 32 of 2025).
The Act received Presidential assent on 22 August 2025. It establishes a statutory framework dealing with e-sports, online social games and online money games.
The central features of the Act include:
- recognition and promotion of e-sports;
- recognition and development of online social games;
- prohibition of online money games and online money gaming services;
- prohibition of advertising relating to online money games;
- restrictions concerning the transfer of funds connected with online money games;
- establishment of the Online Gaming Authority of India (OGAI); and
- penalties and enforcement mechanisms for contraventions of the Act.
The Promotion and Regulation of Online Gaming Rules, 2026 were notified on 22 April 2026 and came into force on 1 May 2026. The rules provide the operational framework for the Act, including registration, categorisation, recognition, grievance redressal and regulatory procedures for online social games and e-sports.
The Online Gaming Authority of India has also been constituted under the new framework and functions as an attached office of the Ministry of Electronics and Information Technology.
CURRENT LEGAL CHALLENGE
The new framework has also generated constitutional litigation.
Petitions challenging the Promotion and Regulation of Online Gaming Act, 2025 have been brought before the Supreme Court of India. The challenges raise issues including legislative competence, fundamental rights, the distinction between games of skill and chance, and the constitutional validity of the prohibition on online money games. The Supreme Court has ordered the connected matters to be heard together.
Therefore, although the PROG Act and the 2026 Rules constitute the current statutory framework, the constitutional validity of the legislation is subject to judicial consideration. The outcome of those proceedings may have an important impact on the future of online gaming regulation in India.
CONCLUSION
In summary, there have been substantial legal, technological, and cultural changes that have resulted in a revolutionary period for the gaming industry in India. India’s gaming culture represents a careful balancing act between tradition and innovation, from its historical roots under colonial-era laws like the Public Gambling Act of 1867 to the modern complexity of online gaming and esports.
The legal position, however, has changed significantly in recent years. The earlier regulatory framework was largely characterised by State gambling laws, judicial decisions concerning games of skill and chance, and regulations dealing with taxation, information technology and other related areas.
The enactment of the Promotion and Regulation of Online Gaming Act, 2025, followed by the Promotion and Regulation of Online Gaming Rules, 2026, represents a major development in India’s approach to online gaming. The framework prohibits online money games while providing for the recognition and development of e-sports and online social games.
At the same time, the continuing constitutional challenge before the Supreme Court demonstrates that the future of India’s online gaming law is not completely settled. Questions concerning legislative competence, fundamental rights and the treatment of skill-based online games remain legally significant.
Comprehensive regulation that places a high priority on player protection, responsible gaming, innovation and industry sustainability is becoming increasingly necessary as the sector develops. The new statutory framework demonstrates the growing recognition of both the opportunities and risks associated with online gaming.
India’s gaming industry is therefore moving from a fragmented and historically developed legal environment towards a more centralised statutory framework. The challenge for lawmakers, regulators, courts and the gaming industry will be to ensure that technological innovation and economic growth are balanced with consumer protection, responsible gaming, constitutional rights and the rule of law.
REFERENCES
- The Public Gambling Act, 1867 — India Code
India Code – Public Gambling Act, 1867 - K.R. Lakshmanan v. State of Tamil Nadu, AIR 1996 SC 1153
Supreme Court of India, 12 January 1996. - The Lotteries (Regulation) Act, 1998 — India Code
India Code – Lotteries (Regulation) Act, 1998 - The Promotion and Regulation of Online Gaming Act, 2025
MeitY – Promotion and Regulation of Online Gaming Act, 2025 - Promotion and Regulation of Online Gaming Rules, 2026
Ministry of Electronics and Information Technology, Government of India, 22 April 2026. - FICCI-EY Report – Indian Media & Entertainment Sector
EY India, 2024. - Supreme Court proceedings concerning the Promotion and Regulation of Online Gaming Act, 2025
Official Supreme Court case record.
Disclaimer: This article is intended for educational and informational purposes only and does not constitute legal advice or a legal opinion. The views expressed are solely those of the author and do not necessarily reflect those of THE LEGAL GAZETTE. Readers should seek professional legal advice for advice relating to specific facts or circumstances.