Kentucky has a law against something that they decide to call, “Advance Gambling Publicly,” which would apply to operators rather than mere players. More than that, the fact that it only applies to a public act would also seem to protect players who were playing at an online casino out of their own homes.

Interestingly enough
Kentucky is one of the few states to actually prosecute a major operator for online gambling operations. Kentucky found PokerStars liable for $870,000,000 in money that was unlawfully lost by residents of the State of Kentucky to the website.
Of course, Kentucky planned to collect this money from PokerStars and stick it in the state’s coffers rather than give it back to the residents who they feel were unjustly affected, apparently, by the conduct of PokerStars. In other words, this was basically a money grab that had nothing to do with actually seeking any justice for residents of the state.
The unfortunate result of that money grab
Several online casinos are hesitant to offer their services in Kentucky due to the negative publicity that could arise from a similar lawsuit happening in the future due to illegal operations. Even with that, there are several online casinos that do offer their services to The Bluegrass State.
Perhaps the funniest part of the PokerStars lawsuit was that Amaya did not even own PokerStars at the time the alleged events occurred.
Kentucky is actually fairly liberal (believe it or not!) as far as players are concerned.
In fact, the code makes it a specific defense to the charge of advancing gambling to state that one was merely acting as a player:
(7) "Player" means a person who engages in any form of gambling solely as a contestant or bettor, without receiving or becoming entitled to receive any profit therefrom other than personal gambling winnings, and without otherwise rendering any material assistance to the establishment, conduct, or operation of the particular gambling activity. A person who engages in "bookmaking" as defined in subsection (2) of this section is not a "player." The status of a "player" shall be a defense to any prosecution under this chapter.
You can read more about all of that on our restrictions page if you like.
In other words, Kentucky pretty unambiguously makes it NOT ILLEGAL to play on internet casinos if you want to do so.
Many operators Avoid the State of Kentucky
It is because of the whole PokerStars lawsuit, but other operators are not concerned, or are unaware, and will offer their services within the state. They probably figure that even if the state does sue them, “On behalf of the players,” that the state has little to no means of actually collecting any judgment that it might levy against the casino.
Please check below for some of the casinos that offer services to you: