California Cannabis Laws

Discover the latest cannabis laws in California, learn about dispensary licensing regulations, eligibility criteria, how to apply, and more.


California set the trend for cannabis businesses all over the country when it became the first country to legalize medical marijuana back in 1996. Nearly three decades later, California has the largest legal cannabis market in the US, with a record $5.1 billion in cannabis sales. Unsurprisingly, it’s also one of the best places to start a retail dispensary.

But successfully applying for a cannabis retail license is only half the battle. Because while cannabis dispensary laws in California are relatively well-established, changes still occur. To help you navigate this journey, we’ve put together this comprehensive guide into the latest legal, regulatory, and compliance aspects of starting and running a Cannabis dispensary in California.

Disclaimer: This page is meant to educate readers and spread awareness only, it is not intended to be, nor should be considered legal advice. This page is current as of March 31, 2024. Given the evolving nature of cannabis regulations, legal advice of any nature should be sought from legal counsel.

Latest Updates

Bill To Legalize Psychedelic Services, Amended Before Vote

The Regulated Therapeutic Access to Psychedelics Act is expected to face a committee hearing in April and was recently amended in preparation for it. The recent update brings several changes, to the bill including:

  • Creation of the “Division of Regulated Psychedelic-Assisted Therapy” which would help regulate psychedelic substances.
  • Creation of the “Board of Regulated Psychedelic Facilitators” to supervise and license trained facilitators.
  • Creation of the “Public Education and Harm Reduction Fund” to help educate and raise awareness about the benefits of psychedelic therapy.
  • Technical changes around data collection requirements, updated medical screening rules and facilitator enforcement provisions, etc.

If passed, the bill would allow adults 21 and older access to psilocybin, MDMA, mescaline and DMT in a controlled environment with licensed facilitators.

Previously Vetoed Cannabis Cafés Bill Proposed Again

Assembly Bill 374 that proposed “Amsterdam-style” cannabis cafés in California was vetoed by Governor Newsom after being passed in the state Assembly and Senate in October 2023.

But in January 2024, Assembly member Matt Haney (D-San Francisco) reintroduced the bill to revive the fight for marijuana cafes. Haney plans to resolve the governor’s concerns of the new bill undermining “California’s long-standing smoke-free workplace protections”. If passed, the bill would allow businesses to sell cannabis products alongside non-cannabis based food and drinks.

New Bill May Change Cannabis-related Employment Protections

Bill SB 1264 proposed in March 2024 would roll back some of the cannabis-related protections afforded to employees. The biggest change being that “employees in sworn or non-sworn positions within law enforcement” would not quality for these protections, including:

  • The apprehension, incarceration, or correction of criminal offenders
  • Civil enforcement matters
  • Dispatch and other public safety communications
  • Evidence gathering and processing
  • Law enforcement records
  • Animal control
  • Community services duties
  • Public administrator or public guardian duties
  • Coroner functions

Cannabis-related Employment Protections Go into Effect

Assembly Bill 2188 (AB 2188) was passed by the California legislation in 2022, and it finally went into effect at the start of this year on 1st January 2024.

Under this new law:

  • Employers will no longer be able to fire or discipline employees who test positive for cannabis in a urine or hair test.
  • Job applicants cannot be refused employment based on the results of such drug tests.
  • Employers are still allowed to use other drug tests, including blood or saliva tests, to check for cannabis use.
  • Jobs in the building, construction industry, and those that require a federal background check or security clearance are exempt from this law.

Governor Newsom also signed into law another legislation in 2023 that prevents most employers from asking job candidates about previous marijuana use. This also goes into effect from 1st January 2024

Marijuana Equity Grants Worth $12 Million Awarded for 2023

The Governor’s Office of Business and Economic Development (GO-Biz) announced that it awarded $12 million worth of marijuana tax-funded grants to cities across California in what was the 4th installment of the city’s Cannabis Equity Grants Program for Local Jurisdictions program.

Governor Newsom called for another $15 million in funding for the program, as solicitation for this year’s grants to begin in October 2024.

Governor Newsom Signs Three More Bills into Law to Wrap Up 2023

In 2023, more than a dozen cannabis and drug policy bills came to California Governor Gavin Newsom’s desk – most of which were signed into law. These included the following three bills signed October 2023 as the final bills of the year:

  • SB 833, proposed by Sen. Mike McGuire, allows cannabis cultivators to request changes in license type or become inactive without reapplying through the DCC.
  • AB 1448, proposed by Assemblymember Greg Wallis, transfers civil penalties from unlicensed marijuana businesses to local treasuries.
  • AB 993, introduced by Assemblymember Blanca Rubio, expands the marijuana task force to include representatives from the Civil Rights Department and Department of Industrial Relations.

California Cannabis Laws Quick Peek

  • Individuals aged 21 or older can purchase it for recreational purposes, while those aged 18 or older can purchase cannabis with a physician's recommendation for medicinal use.
  • The regulating organization in California for cannabis is the Department of Cannabis Control (DCC).
  • Adults can now purchase up to 1 ounce (28.5 grams) of cannabis or up to 8 grams of concentrated cannabis for personal use.
  • Cannabis can only be consumed in a private setting and not in public.
  • The base cost to start a cannabis dispensary in California includes $1,000 in application fees and anywhere between $2,500 to $96,000 in license fees depending on your projected revenue.
  • California has contracted METRC and uses CCTT–METRC as its official track and trace system.

Key Dispensary Laws and Regulations

Minimum Age: The minimum age to possess and consume recreational cannabis in California is 21 years or older. The minimum age for medical users is 18 and above with a physician's recommendation.

Possession Limits: Adults in California are allowed to purchase and possess up to 1 ounce (28.5 grams) of cannabis or up to 8 grams of concentrated cannabis for personal use. Possession inside of homes is unlimited (given it's not visible to the public).

Medical Use: California residents can access medical cannabis through the state's program by registering, holding a medical marijuana card, and obtaining a prescription from licensed physicians.

Recreational Use: Recreational cannabis can legally be bought and sold in California for adults 21 years or older.

Consumption Areas: Cannabis use, including smoking, vaping, and consumption, is allowed only in private residences or designated cannabis consumption areas. Property owners can ban cannabis use on privately-owned property. Using cannabis in public spaces or while driving is illegal and may result in fines of up to $50.

Regulatory Organization: The Department of Cannabis Control (DCC) is responsible for licensing and regulation of cannabis in California.

Growing Regulations: Individuals over 21 years old are allowed to grow up to 6 plants per person, or 12 plants per household.

Frequently Asked Questions (FAQs)

California Cannabis Laws

An overview of the medical and recreational marijuana laws in California.

What are the purchasing limits in California?

For recreational use, adults are restricted to buying no more than 28.5 grams (one ounce) of non-concentrated cannabis, 8 grams of concentrated cannabis, and 6 immature cannabis plants per day.

For medicinal use, patients and primary caregivers can purchase and possess 8 ounces of medicinal cannabis per day.

How old do you have to be to work at a dispensary in California?

The minimum age you need to be to work in a cannabis dispensary in California is 21 years of age.

What are my responsibilities with regard to customer verification?

Retailers are responsible for verifying the age and identity of every customer. Selling to minors is a major offense, and law enforcement agencies are authorized to use decoys to catch offending retailers.

Adult-use customers must be 21 or older with valid identification; medicinal customers must be 18 or older with valid ID and a certified physician’s recommendation.

Am I able to manufacture edible cannabis products on the premises for consumption on said premises, e.g. a cannabis-infused food restaurant?

Chapter 4, § 15500 of DCC’s Commercial Cannabis Regulations states that a licensed microbusiness may perform all cultivation, manufacturing, distribution, and retail activities on the same licensed premises. That’s clear cut, but laws surrounding cannabis consumption are slightly more complicated.

The section specifically does not restrict the consumption of cannabis goods on the premises of a licensed retailer or licensed microbusiness authorized to sell cannabis, provided that the consumption adheres to the regulations outlined in the Business and Professions Code section 26200(g).

Additionally, Section 15603, Temporary Cannabis Event Consumption states that cannabis consumption is allowed at an authorized temporary cannabis event; however, a temporary cannabis event license can only be issued to a person who holds a temporary cannabis event organizer license, which you must apply for through the Bureau of Cannabis Control. A temporary cannabis event license will not be issued for more than four days.

Retail Cannabis Licensing in California

Everything you need to know about opening a retail cannabis location in California.

How much does an annual dispensary license cost in California?

The base cost of a cannabis dispensary license in California includes an application fee of $1,000, plus a licensing fee that’s based on the projected value of your operation.

Annual Dispesary License cost in California

DCC's Application and license fees for retailers

What are the requirements for an annual license?

The DCC provides a handy Annual License Application Checklist to help ensure applicants have all the necessary information prior to starting their online annual license application. The main cannabis retailer application requirements include:

To apply for an annual license, you must complete and submit the California cannabis retailer license application or apply through the Bureau’s online application system.

Editor’s Note: Applicants must include a license, permit, or other form of approval from your local jurisdiction in order to be eligible for a temporary or annual license.

What license type do I need to serve adult-use customers and medical patients?

For adult-use, businesses need an “A-license” and for medicinal cannabis, an “M-license” is needed. Businesses can sell both from the same location, given they have, successfully and separately, applied for both license types.

What is a non-storefront retailer license?

A non-storefront retailer in California sells cannabis products exclusively through delivery. A non-storefront retailer must have a licensed physical location to securely store cannabis inventory (which should not be open to the public).

What are the requirements for a non-storefront retailer license?

Non-storefront retailer applicants must meet the same requirements as storefront retailers, including informing the Bureau of how they intend to:

  • Accept and process orders of cannabis goods
  • Verify the identity and age of a potential customer
  • Verify the delivery address is in California and not a public property
  • Deliver cannabis products to customers (including vehicle and GPS information)

For a list of the attached documents and requirements, read our guide on Rules for Starting a Cannabis Delivery Service in California.

What are the fees for a non-storefront retailer license?

Fees for non-storefront retailers are structured the same way as storefront retailers, including a $1,000 application fee plus a licensing fee based on the projected value of the operation.

Do I need a license to throw events involving cannabis?

Depends. Events that solely provide cannabis information or education, without sales or consumption, do not require licensing under 4 CCR §15604(a).

For anything else, yes, you need two licenses to hold a cannabis event: a cannabis event organizer license and a temporary cannabis event license (application for which needs to be submitted at least 60 days before the event).

Editor’s Note: A temporary cannabis event license will only be issued for a single day or up to 4 consecutive days.

What are the requirements for holding a temporary cannabis event?

In addition to the necessary licenses, the DCC also requires temporary cannabis events to have:

  • Event organizer(s), at least one of which will be present on-site during the event. In addition to this, the organizers are also required to hire security, post required signs, provide the DCC with a list of participants as well a diagram showing the layout of the event and where participants will be set up.
  • Only persons 21 years of age or older may attend the event.
  • All sales of cannabis products may occur at an area designated specifically for retail sales.
  • Only licensed retailers (including non-storefront retailers) and licensed microbusinesses are authorized to sell cannabis products.
  • Licensees cannot give out free samples or “taste tests” of cannabis goods during the event.
  • Free medicinal cannabis may be provided to attendees in accordance with Section 15411 of the DCC Commercial Cannabis Regulations.

For more information, refer to the Department of Cannabis Control’s official guidelines on cannabis-related events.

California Cannabis Retail and Dispensary Establishment Laws

Learn how to remain compliant with California’s cannabis retail laws.

What security measures am I required to take?

Required security measures for retailers include:

  • ID badges for all employees
  • Limited-access areas within the facility
  • Security personnel
  • 24-hour video surveillance of all areas containing cannabis products and all point of sale areas
  • Alarm systems
  • Commercial-grade locks
  • Secure storage of all cannabis products

Can I package and label cannabis on the retail premises?

No. All cannabis products must be packaged and labeled prior to arriving at the retail facility.

Can I sell alcohol or tobacco at my cannabis retail store?

No. Alcohol and tobacco sales are unauthorized at cannabis retail stores.

Are product giveaways and gifting allowed?

Cannabis retailers are NOT permitted to provide free cannabis products.

However, there is one exception for retailers who hold a medicinal retail license and want to donate cannabis

products to qualified medicinal patients who have difficulty accessing cannabis. The criteria for this exception is spelled out in §15411 of the California cannabis regulations.

What are the operating hours for a retail shop?

Retail establishments may conduct business between 6 a.m. and 10:00 p.m. Pacific Time. Licensed non-storefront retailers may conduct sales and deliveries between 6 a.m. and 10 p.m. Pacific Time.

Can I have public-facing displays on my storefront?

No. Cannabis goods may only be displayed in the retail area and may not be visible from outside the store.

What are the delivery requirements for a non-storefront retailer?

Just like storefront customers, delivery customers must provide valid ID before purchasing cannabis products. Customers must be aged 21 or older to purchase adult-use cannabis, or 18 or older with a valid physician’s recommendation to purchase medical cannabis.


  • Deliveries may not be made to addresses on publicly owned land, schools, day care centers, or youth centers
  • Delivery employees must carry government-issued ID, an ID badge provided by the retailer, and a copy of the retailer’s license during all deliveries
  • Delivery employees cannot carry more than $5,000 worth of cannabis goods at any time
  • Deliveries must be made by a direct employee of the retailer in an enclosed vehicle equipped with a GPS device and secure storage for cannabis goods

More information on non-storefront cannabis retail can be found here.

Cannabis Tracking and Reporting in California

Every regulated cannabis market has its own tracking and reporting requirements. Find here how California monitors commercial cannabis activity.

What is track and trace reporting, and what is required of me as a retailer?

Track and trace, or “seed to sale” reporting, is how the state monitors and traces every single cannabis plant along its entire life cycle—from seed to final consumer sale.

California has chosen Metrc as its official track and trace system. Retailers are required to submit daily reports with specific data from every commercial cannabis activity—including every sale, receipt, return, and disposal of cannabis products—by 11:59 p.m. of the day on which it occurred.

What is Metrc?

Metrc is a cannabis track and trace reporting system that allows state governments to monitor commercial cannabis activity. Metrc, short for Marijuana Enforcement Tracking Reporting Compliance, was originally developed for the state of Colorado but it is now used by many states with adult-use cannabis markets, including California.

Editor’s Note: It’s important to note that Metrc is simply a reporting tool. It is a robust inventory management platform or Point of Sale (POS) system. As a dispensary owner, it’s important to find an inventory management and POS system that integrates with Metrc to make compliance easier.

Do California cannabis stores have to use CCTT-Metrc?

Yes, the state makes it very clear that any California cannabis retailer with an annual license is required to use the CCTT-Metrc system. They are welcome to use other technology providers in addition to Metrc, but stores must report their data to the state through Metrc.

When can I start working with Metrc?

The state suggests that potential licensees assign a designated Metrc account manager to complete Metrc training during the license application process. Dispensary owners are required to finish training before they can start using the Metrc system.

Once you receive your annual retail operator license along with your username and password for Metrc, you may start using the system by ordering CCTT-Metrc UID tags for all of your current inventory (the cost of these tags are baked into the annual license fee).

How do I report in Metrc?

There are two ways to enter your daily track and trace reports.

Manual Reporting: This method requires logging in to your Metrc account at the end of every single business day and manually entering all the data from every transaction and other activity that occurred. Along with being time-consuming and cumbersome, manual reporting puts you at great risk of mistakenly recording incorrect information—which can lead to a serious compliance issue.

Automatic Reporting: Dispensary software specifically designed for cannabis retail (like Cova POS) can integrate with Metrc and automatically sync reportable data from your store’s transactions and activities as they occur in real time.

How do I report if the system is down or the internet is out?

If you lose connectivity to Metrc or experience an internet outage that prevents you from daily reporting, you must record all reportable information and upload it to the system within three days of restored connectivity.

Ideally, the POS system you choose should come with a built-in offline sales processing mode that enables access to critical functions even when your Wi-Fi or internet connection is unavailable. Once the internet is back up, all transactions should be synchronized with the state’s reporting system, the data be backed up, and reports and inventory records adjusted accordingly.

How do I manage state compliance using my point-of-sale?

Every retail cannabis location will need a dispensary POS software that provides complete seed-to-sale tracking functionality. To make state compliance easier, look for a point-of-sale software with the following built-in features:

Purchase Limits:The POS system should automatically calculate the correct THC amounts for all products, including concentrates and edibles. This prevents mistakes in calculation and allows your budtenders to focus on customer service.

The system should also enforce purchase limits by alerting staff when a limit has been reached and preventing a sale that would place you over the legal limit.

Hours of Operation: Once the local operational hours are configured, the POS should not allow sales to be executed outside the legal hours of operation, preventing costly violations.

Fully Compliant Product Labeling & Receipts: Complete customization of all printed materials, product labels, and receipts, enabling you to comply with all local regulations related to labeling and packaging quickly and easily.

Customer Identification Requirements: Customer IDs need to be scanned and recorded, ensuring your staff double checks IDs and virtually eliminating potential sales to minors or other individuals lacking the requisite documentation.

Accurate Real-Time Reporting: POS software like Cova will generate management reports in real time that bring operational visibility into your business.

Why is it important to have a marijuana-specific POS vs. a retail or pharmacy POS?

There are several reasons why a cannabis-specific POS is ideal for your operation—but the most important one is compliance management. Because traditional retail operations and pharmacies don’t have the same government-mandated compliance requirements, their POS systems aren’t built to manage the complexities involved with track and trace reporting and the other aspects of state compliance.

Also Read: California Cannabis Compliance: 7 Key Aspects to Consider

What happens if the state regulations change?

With the industry still in its infancy, regulations are bound to change. Your technology partner should keep up with industry-wide and state-specific changes to quickly make any necessary software updates.

Is Cova integrated with Metrc?

Yes, Cova now integrates with CCTT-Metrc in California! Once our POS is up and running in your retail location, all inventory should be tagged with Metrc tags, allowing Cova to report your sales to the state for you.

How do I do the 14-day inventory reconciliation?

California’s inventory reconciliation requirement will be an ongoing task, required every 14 days. Your POS system should allow you to print a full Inventory-on-hand report. Employees can then check it against your physical inventory with an inventory count. Then make any necessary adjustments directly into your inventory management system. If you have a quality technology partner, it will then sync the data across your network.


With growth this fast, the California cannabis market might as well be living and breathing. Although the pace of growth does pose a few logistical, legal, and regulatory challenges, it’s also why California is one of, if not, the best place to start a cannabis retail dispensary in 2024.


Lauren Estevez

Attorney & Founder, LME Law

Legally reviewed by

Lauren Estevez

Lauren is an attorney and nationally-recognized subject matter expert in Cannabis and CBD Law. Based in Los Angeles, Lauren advises licensed cannabis industry brands, operators, and ancillary businesses on legal strategy, regulatory compliance, and transactional matters. Her work has been featured on CNBC, Bloomberg Law, and at SXSW. Lauren has been practicing in the cannabis space since shortly after Proposition 64 was passed in California, and has completed over 100 cannabis projects with U.S. and international clients. In addition to cannabis, Lauren also advises clients on CBD and The Farm Bill. In 2019, The National Law Journal recognized Lauren as a Cannabis Law Trailblazer.

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