"New Jersey must be allowed to move forward with sports gaming and bring much-needed revenue to the state," Pallone said. "Rather than continuing to allow criminal and offshore entities to reap the benefits of illegal gaming, we should let the democratic process in New Jersey bring sports gaming under controlled regulation."

LoBiondo said New Jersey "has been clear about its intent to host sports betting," and said making it legal would help Atlantic City compete with Las Vegas.

In 1992, Congress prohibited states from establishing any new sports gaming, which left Las Vegas as the only legal place to bet on games. The two members each proposed a bill offering a possible way around the ban.

Pallone's bill, H.R. 626, would exempt New Jersey from federal law. LoBiondo's bill, H.R. 625, would give all states until the end of 2016 to enact laws allowing sports gaming, if they wish.

The issue may be decided in the courts as well. A federal court is hearing arguments about New Jersey's attempt to accept sports bets. In late 2011, New Jersey residents voted to allow sports gaming, and a law allowing these bets was signed by Gov. Chris Christie (R ). But federal law still prohibits that law from being implemented.

"Whether it is through the courts, through my bill or through Congressman LoBiondo's bill, I believe that ultimately New Jersey's right to move forward with sports gaming will be recognized and I look forward to working to that end," Pallone said.