Nevada's statewide ban on cannabis in retail casinos is leaving around $750m in revenue on the table, according to a report released by the University of Nevada, Las Vegas (UNLV). BonusFinder, an online casinos comparison site, explores whether reform is possible.
Published on May 1, 2026, the UNLV study – titled 'The 1,500-Foot Wall: Barriers between Cannabis and Gaming in Nevada and the Potential for Integration' – evaluates how a longstanding prohibition against cannabis nearby, or within, casino venues directly correlates with diminishing State tax revenue, and describes the innate relationship between the ban and illegal marijuana vendors.
A presentation covering the main points of this paper was held by California's UC Davis Cannabis Economic Group Director, Robin Goldstein, who detailed that there is immense strain on visitors to Las Vegas seeking to purchase cannabis legally.
Nevada law forbids licensed cannabis businesses from operating within 1,500-feet of a regulated land-based casino. Given the significant volume of casino establishments along the Las Vegas Strip, tourists visiting the area are effectively blocked from accessing legitimate marijuana outlets.
Consequently, local businesses that would otherwise benefit from legal cannabis availability are missing out on up to $750m in annual revenue, while $80m in State tax revenue is also being relinquished.
Three key barriers stifling revenue
Goldstein explained that limitations in three core areas are driving the State's cannabis tax losses:
- Cannabis delivery: Nevada only allows cannabis deliveries to private residences, thereby excluding entertainment, hotel and gaming complexes.
- 1,500-foot blockade: Cannabis vendors are not permitted to operate within 1,500-feet of a retail casino, forcing visitors to travel beyond the Strip to purchase.
- Separated business: Regulations prevent integrated business relationships, investment and ownership opportunities between gaming and cannabis entities.
"Tourists in Las Vegas, as well as other parts of the State, have no access in the main areas where they stay and establishments they frequent most, including the Las Vegas Strip," illustrated Goldstein.
Cannabis demand on the Las Vegas Strip pushes people towards street dealers
In 2025, 38.5 million tourists ventured to Las Vegas, with almost 70% of visitors checking in with Strip hotels and resorts.
And, in the face of a 13-month downturn in visitation, data released by the Las Vegas Convention and Visitors Authority (LVCVA) showcased year-on-year improvements in February and March 2026.
But not a single individual who has contributed to that uptick in Sin City has been able to access legal cannabis vendors while on the Strip.
Worse, steep travel fares and 'substantial' pedestrian journeys to licensed cannabis merchants mean tourists rarely explore the regulated industry. For many, the black market is sufficient, "because people are willing to sell you cannabis all over Las Vegas, including the Strip," says Goldstein.
Unintentional public safety issues have emerged from this cannabis-gaming ban; visitors to the Strip regularly liaise with unlicensed street dealers to acquire marijuana.
For casino operators, illegal dealings occurring "in front of, outside, near, and on properties," could generate tangible security and safety problems.
Crucially, when visitors do opt to search for legal cannabis dispensaries located outside the Strip, they may not return for quite some time – instead choosing entertainment and dining options elsewhere. Goldstein calls this a "loss of complementary spending" for Las Vegas.
Nevada knows the solution, but is reform possible?
Nevada legalized commercial dispensaries in 2013. One year later, the state Gaming Commission penned rules to block cannabis use on or near gaming properties.
More than a decade on from those measures being enacted, there appears limited appetite among operators to loosen rules barring the Schedule I substance.
The primary explanation is quite simple: marijuana is viewed by the Federal Government as a controlled substance. Operators are not particularly eager to enter a federal battle and, more pertinently, do not want to risk their gaming license.
Democratic Assemblyman Max Carter presented a Bill in 2024 that sought to legalize cannabis delivery at non-gaming establishments. The motion ultimately fell short; Carter believes its failure stemmed from operators nervous of federal banking pressure.
Senator Rochelle Nguyen spoke during the UNLV presentation, branding the State's current ruleset as "ridiculous".
Nguyen added that notions suggesting the cannabis market would not serve a purpose in the tourism sector are "naive, inaccurate and not what's happening out there in the tourism corridor".
She acknowledged that the state "had good intentions" when formulating anti-cannabis stipulations but, as the industry evolves, Nguyen argues that Nevada must move forward in tandem.
Although cannabis reform appears unlikely today, ex-MGM Resorts executive Alan Feldman noted that the casino scene has warmed to industries it had previously rejected. Online and mobile casino gaming, nightclubs and tribal operators represented his example triad.
Feldman, an American Gaming Association Hall of Fame inductee, outlined that customer demand guides operator behavior – and that some Las Vegas venues have already arranged draft ideas for on-site cannabis lounges.
Joint movement needed to alter unsustainable path
In the UNLV report, Goldstein's team presents a straightforward plan of action: Unlock the barriers that are actively forcing consumers to illegal cannabis markets.
However, realistic "share" agreements must come to the fore if operators are to accept marijuana integration.
Specifically, it is anticipated that Las Vegas casinos would create designated cannabis areas overseen by third-party vendors – mirroring similar deals with "nightclubs and bars", believes Goldstein.
These licensed cannabis merchants would distribute a portion of income to the casino, which essentially acts as its landlord.
He continued: "If a cannabis establishment were allowed to be inside a gaming resort, that's not enough. You have to allow percentage rent agreements that allow a landlord from the success of that store."
The study concludes by calling on legislators to revise existing regulations, beginning with a "joint report" on possible cannabis integration.
But until lawmakers cooperate with research teams and heed direct warnings tied to safety concerns, market unsustainability and missed profit, Nevada will continue to knowingly surrender tens of millions of business and tax dollars.
