The Court struck down the Professional and Amateur Sports Protection Act, a 1992 law that prohibited state-authorised gambling with a few restrictive exceptions, by six votes to three.
Previously Nevada, given an exemption in the 1992 law, had been the only American state where a person could bet on the results of a single sports game.
The ruling ends a six-year legal battle between the state of New Jersey and the NCAA, the body that governs college sports, NFL, NBA and the NHL respectively.
Senator Bill Bradley, Democrat of New Jersey and a former basketball star with the New York Knicks and the Olimpia Milano, was one of the principal backers of the 1992 Act. Bradley said the law was needed to safeguard the integrity of sports.
The court opinion stated: “Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own. Our job is to interpret the law Congress has enacted and decide whether it is consistent with the Constitution. PASPA is not.”
The American Gaming Association estimates that Americans illegally wager about $150bn on sports each year and the ruling may be seen aS creating a more regulated and transparent, commercial betting market, no longer forcing Americans to use illicit bookies.
Geoff Freeman, the president and ceo of the American Gaming Association, said in a statement that the court’s decision is “a victory for the millions of Americans who seek to bet on sports in a safe and regulated manner.”