Four Native American tribes in New Mexico are asking a federal judge to shut Kalshi out of their lands, and the fight over kalshi new mexico tribes jurisdiction reaches a courtroom in Las Cruces on September 23. The Mescalero Apache Tribe and the Pueblos of Sandia, Isleta, and Pojoaque filed suit in May, arguing that Kalshi’s sports-related event contracts are sports betting in disguise, running on their land without permission. U.S. District Judge Margaret Strickland will hear both sides argue over whether to grant a preliminary injunction while the underlying case continues.
What the Tribes Are Asking For
The tribes want Kalshi blocked from operating anywhere within their reservation boundaries. Their preferred fix is geofencing — the same location-blocking technology Kalshi already uses to comply with state bans elsewhere, as detailed in our coverage of the Nevada geofencing dispute. If Kalshi can wall off Nevada, the tribes argue, it can wall off tribal land too.
Their core complaint is jurisdictional. Under the Indian Gaming Regulatory Act and their individual gaming compacts with the state, only tribal casinos can legally offer sports wagering on tribal land, and only to people 21 and older. Kalshi’s app, the tribes say, lets anyone 18 or older place the same kind of bets, undercutting both the age limit and the tribes’ exclusive gaming rights. They also point to gambling revenue that funds schools and tribal services as money at stake if Kalshi keeps operating unchecked.
Kalshi’s Federal Preemption Defense
Kalshi’s response leans entirely on one argument: federal law trumps tribal law here. The company says its contracts are financial derivatives regulated exclusively by the Commodity Futures Trading Commission under the Commodity Exchange Act, and that this federal framework preempts the Indian Gaming Regulatory Act and any tribal ordinance that conflicts with it. It’s the same jurisdictional playbook Kalshi has run in state-level fights, including the ongoing dispute we covered in our piece on the Tenth Circuit’s Utah ruling.
Kalshi also argues tribal authority stops at the reservation line when it comes to internet activity, since a bet placed through an app isn’t physically occurring on tribal soil the way a slot machine spin is. The company further contends the tribes waited too long to seek an injunction, and that pulling its markets now would disrupt a “status quo” that has existed since the app became available in the state.
Why the Timing Matters
This case sits alongside a separate lawsuit New Mexico Attorney General Raúl Torrez filed against Kalshi in June, which argues the platform operates as an unlicensed sportsbook under state law. Two tracks — one tribal, one state — are now moving through New Mexico courts at the same time, each testing a different piece of the same jurisdictional puzzle. A win for the tribes would not resolve the state’s separate claims, and vice versa, but a ruling in either case could shape how courts elsewhere read Kalshi’s preemption defense.
New Mexico joins a growing list of states where Kalshi is fighting to keep its sports-related contracts running. We’ve tracked similar standoffs in Washington and in Missouri, where regulators issued cease-and-desist orders over the same category of contracts. What makes the New Mexico case different is the plaintiff: not a state gaming commission, but sovereign tribal nations asserting rights under a separate body of federal law that Kalshi’s usual CFTC-preemption argument wasn’t built to answer directly.
What a Preliminary Injunction Would Actually Do
A preliminary injunction wouldn’t end the lawsuit. It would only pause Kalshi’s tribal-land operations while the case plays out, based on whether Judge Strickland finds the tribes are likely to win on the merits and would suffer harm without immediate relief. Courts set a high bar for this kind of order, which is part of why Kalshi’s brief leans hard on arguing the tribes waited months before asking for one.
If Strickland grants the injunction, Kalshi would likely need to geofence tribal boundaries the way it already does for states with outright bans. If she denies it, Kalshi keeps operating in New Mexico while the case moves toward trial, and the tribes’ broader claims about age limits and compact violations remain unresolved for months. Either outcome will get cited in the other tribal and state cases against Kalshi still working through the courts.
The Bigger Picture
Kalshi has built its entire national footprint on the idea that CFTC oversight is a single federal umbrella that state and now tribal regulators can’t poke holes in. New Mexico’s tribes are testing whether that umbrella actually covers land governed by a separate federal statute, the Indian Gaming Regulatory Act, rather than state gambling codes. It’s a narrower legal question than the state-level fights, but the answer could matter well beyond New Mexico, since dozens of tribal nations across the US hold similar gaming compacts and exclusivity rights.
For now, all sides are waiting on Judge Strickland. The September 23 hearing won’t settle the underlying lawsuit, but it will show how a federal judge weighs tribal sovereignty against Kalshi’s preemption argument for the first time in this specific context, and that answer is likely to shape how other tribes weigh their own legal options against prediction market platforms operating on their land.
