The short answer: DraftKings daily fantasy sports (DFS) is legal in South Carolina in 2026, thanks to the passage of the Daily Fantasy Sports Act in late 2025 that amended the state’s gambling statutes and explicitly exempted DFS from the definition of illegal wagering.
What changed in South Carolina law?
Prior to 2025, South Carolina’s gambling code defined “betting” broadly enough to capture DFS, and the state’s Attorney General issued opinions that daily‑fantasy contests violated the law. In 2025 the General Assembly enacted the Daily Fantasy Sports Act, amending § 56‑5‑220 to carve out a “game of skill” exemption for fantasy contests that meet three criteria: (1) the contest is based on real‑world player performance, (2) the player’s skill determines the outcome more than chance, and (3) the entry fee does not exceed $100 per contest. The amendment was signed by the governor on December 12, 2025 and became effective on January 1, 2026.
How DraftKings complies with the new statutes
DraftKings adapted its platform to meet the statutory requirements. All South Carolina contests now cap entry fees at $100, display clear skill‑based scoring tables, and provide a “skill‑focus” tutorial before entry. The company also registers its South Carolina operations with the Department of Revenue, a step mandated by the Act to ensure transparency and to facilitate state tax collection on gross gaming revenue.
Enforcement and penalties
The Act authorizes the South Carolina Law Enforcement Division (SLED) to investigate unlicensed operators. Penalties for non‑compliance include civil fines of up to $10,000 per violation and the possibility of criminal charges if the operator willfully disregards the law. Since the law’s effective date, SLED has announced routine audits of online fantasy platforms and issued compliance notices, but no major enforcement actions have been reported.
Recent legal challenges and court rulings
Two lawsuits were filed in early 2026 challenging the “skill” exemption. The Circuit Court in Charleston dismissed both cases, ruling that the legislative intent was clear and that DFS meets the skill‑dominant test. The decision was upheld on appeal in September 2026, solidifying the legal foundation for DFS in the Palmetto State.
Outlook for 2027 and beyond
Analysts predict that the legal certainty will encourage more operators to seek South Carolina licenses, expanding the market beyond the current leaders. The state expects to generate approximately $5 million in annual tax revenue from DFS by 2028, according to the Department of Revenue’s revenue projections.
FAQ
Is there an age requirement for playing DraftKings DFS in South Carolina?
Yes, players must be at least 18 years old and provide a valid South Carolina driver’s license or state ID to verify age and residency.
Can I win real cash in DraftKings DFS contests?
Absolutely. Prizes may be paid in cash or electronic funds, provided the contest fee does not exceed the $100 limit set by the Act.
Do state taxes apply to DFS winnings?
All winnings are subject to South Carolina state income tax. DraftKings automatically withholds the appropriate amount for winnings over $600, and players receive a 1099‑MISC at year‑end.
Are there any restrictions on the types of sports I can use in DFS?
The law does not limit sport categories, but contests must be based on professional or collegiate games recognized by the NCAA or major leagues. Fantasy contests involving purely recreational leagues are not covered by the exemption.
What should I do if I suspect an illegal DFS operator?
Report the activity to the South Carolina Department of Revenue’s Consumer Protection Division or to SLED. Provide screenshots, entry receipts, and any correspondence to assist the investigation.