In 1988, Congress passed the Indian Gaming Regulatory Act which recognized the right of Indian tribes in the United States to establish gambling and gaming facilities on their reservations as long as the states in which they are located have some form of legalized gambling. Two cases in the 1980's led up to this act: Seminole Tribe of Florida v. Butterworth and California v. Cabazon Band of Mission Indians.

The Seminole case opened the doors to high-stakes bingo on reservations all over the country. Florida tried to close the Seminole tribe's high-stakes bingo parlor (opened in 1979), but the court ruled that bingo fell under statutes classed as regulatory rather than prohibitory.

The Cabazon case established that once a state has legalized any form of gambling, Indian tribes within that state can offer the same game on trust land without any state interference or restrictions. [Trust land is reserved for and owned by Indians but held "in trust" by federal government for the benefit of the Indian owners.] This case brought up concerns about tribal regulation of Indian gaming among many groups (i.e. Nevada and New Jersey where gambling is legal, the National Association of Attorney Generals, the National Sheriffs' Association).  

In response to the concerns arising, Congress passed the Indian Gaming Regulatory Act (IGRA). This act went into effect on October 17, 1988:  

The act is intended to 1) promote tribal economic development, self-sufficiency, and strong tribal government; 2) provide for a regulatory base to protect Indian gaming from organized crime; and 3) establish the National Indian Gaming Commission.