However Gov. Bill Lee on Friday warned that any future attempt to expand gambling throughout the state would result in a veto.
Lee announced he was allowing the bill to become enacted because it did not "pursue casinos," which he said encourages criminal activity.
The legislation, which has a July 1 effective date, would allow regulated statewide mobile and interactive sports gambling for people 21 and older.
The proposal is projected to bring in more than $50 million annually.
States are increasingly legalizing sports betting after the U.S. Supreme Court cleared the way last year.
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