Illinois Cannabis Laws

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


On June 25, 2019, Illinois became the 11th U.S. state to legalize recreational cannabis for adult use and the first to do so through legislation rather than a ballot initiative. In the five years since, Illinois has become a behemoth of a cannabis market, with total sales crossing $1.6 billion in 2023.

Despite higher average cannabis prices, Illinois’ growth rates remain competitive, and behind this growth is Illinois’ Department of Financial & Professional Regulation. The IDFPR has launched numerous initiatives to bolster the local cannabis ecosystem, along with consistent updates to provide the necessary legal and regulatory scaffolding.

This comprehensive guide dives into the latest legal, regulatory, and compliance aspects of starting a Cannabis dispensary in Illinois.

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 April 3, 2024. Given the evolving nature of cannabis regulations, legal advice of any nature should be sought from legal counsel.

Latest Updates

Loan Applications Open for Licensed Social Equity Cannabis Dispensaries

On February 29, 2024, Illinois Governor JB Pritzker announced Round 2 of the Cannabis Social Equity Loan Program, offering $12 million in Direct Forgivable Loans to support licensed social equity cannabis dispensaries.

This round focuses on supporting dispensaries, helping them overcome entrepreneurial barriers, and addressing past drug policy impacts with up to $240,000 in loans per business. Applications are open until April 17, 2024.

Illinois Lawmaker Introduces Psilocybin Therapy Legalization Bill

On February 20, 2024, Illinois Democratic Senator Rachel Ventura introduced Senate Bill 3695, also known as the Compassionate Use and Research of Entheogens (CURE) Act.

If passed, the bill would legalize supervised therapeutic use of psilocybin for adults to help treat a variety of health conditions including anxiety, depression, PTSD, substance abuse, eating disorders, etc., as well as establish the Illinois Psilocybin Advisory Board to oversee training and licensing.

The bill will not legalize recreational use of psychedelic substances.

New Law Removing Licensing Fees for Existing Cannabis Transporters

On December 8, 2023, Illinois Governor JB Pritzker signed SB 1559 into law. The new law exempts existing cannabis transporters from annual licensing fees from January 1, 2024, to January 1, 2027.

To create more opportunities for existing, small independent transports, the law also prohibits new license applications for cannabis transporters from being granted until January 2027.

McHenry County Forces Dispensaries to Display New Warning Labels

On September 23, 2023, McHenry County officials implemented a strange new rule – display mental health warning signs associated with cannabis use, including psychosis, depression, and suicidal ideation. McHenry County dispensaries would be the first in the country to post such warnings.

Led by the state's attorney who is threatening legal action against non-compliant businesses, aiming to remove claims of medical benefits from marketing materials. The initiative is being criticized by the Illinois Cannabis Regulation Oversight Office and four state lawmakers.

New Year’s Budget Brings Tax Break to Illinois Cannabis Businesses

On June 7, 2023, Governor J.B. Pritzker signed the budget bill for 2024 and introduced tax deductions for licensed cannabis businesses starting January 1, 2023.

The bill will allow cannabis businesses to deduct business expenses under Section 280E of the Internal Revenue Code, following other states that enacted similar measures. The bill also establishes the Cannabis Business Development Fund, offering low-interest loans to social equity applicants.

Illinois Cannabis Dispensary Key Laws and Regulations

  • Minimum Age: Under the state’s Cannabis Regulation and Tax Act, recreational cannabis sales to adults aged 21 and older officially began on January 1, 2020. Medical patients under 21 years old may receive a prescription for cannabis and purchase or have their caregiver purchase cannabis from a medical dispensary.
  • Possession Limits: Illinois residents are allowed to legally possess one ounce (about 30 grams) of cannabis flower, 5 grams of cannabis concentrate, and cannabis-infused products with a maximum of 500 milligrams of THC.
  • Medical Use: Illinois residents can access medical cannabis through the state's Medical Cannabis Patient Registry Program by getting a medical cannabis card for their debilitating medical condition.
  • Recreational Use: Recreational cannabis can legally be bought and sold in Illinois for adults 21 years or older.
  • Consumption Areas: Cannabis can be legally consumed inside a private home, a private property (after getting the owner’s permission), approved dispensaries, and retail tobacco stores.
  • Regulatory Organization: The Illinois Department of Financial and Professional Regulation is responsible for licensing and regulation of cannabis in Illinois while the Cannabis Regulation Oversight Office (CROO) is responsible for maintaining compliance with state laws, monitoring cannabis programs, and promoting diversity and equity.
  • Compliance Software: Illinois has selected BioTrack as its official cannabis verification and monitoring system.
  • Growing Regulations: Illinois growers that have a Medical Cannabis Card are allowed to grow up to 5 plants per household under specific conditions.

Frequently Asked Questions

Illinois Cannabis Laws

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

Who can purchase cannabis in Illinois and what are the limits?

Adults aged 21 and older as well as qualifying patients holding a valid Medical Cannabis Patient ID card and their registered caregivers can purchase cannabis from licensed retailers in Illinois.

Illinois residents over the age of 21 may legally possess up to 30 grams (approximately 1 ounce) of cannabis flower, 500mg of THC infused in cannabis products, and 5 grams of cannabis concentrate.

Purchase limits for non-residents are halved to 15 grams of cannabis flower, 250mg of THC infused in cannabis products, and 2.5 grams of cannabis concentrate.

Is home cultivation allowed in Illinois?

Home cultivation in Illinois is only allowed for Registered Qualifying Medical Cannabis Patients, who may grow up to 5 cannabis plants at home while following personal cultivation restrictions.

Where can cannabis be consumed in Illinois?

In Illinois, cannabis consumption is restricted to private settings and licensed cannabis consumption lounges.

It is prohibited in public places, including state and local government properties, and near individuals under 21 years old. Possession is not allowed in vehicles, schools, correctional facilities, childcare centers, or federal properties. Additionally, cannabis use is banned while operating vehicles or engaging in tasks requiring attentiveness.

What are the qualifying conditions for medical marijuana in Illinois?

Patients with the following conditions can qualify for a medical marijuana card:

  • Female Orgasmic Disorder (FOD)
  • Amyotrophic Lateral Sclerosis (ALS)
  • Alzheimer’s Disease
  • Anorexia Nervosa
  • Arnold-Chiari malformation
  • Autism
  • Cachexia/Wasting Syndrome
  • Cancer
  • Causalgia
  • Chronic Inflammatory Demyelinating Polyneuropathy
  • Chronic Pain
  • Complex Regional Pain Syndrome Type II (CRPS)
  • Dystonia
  • Ehlers-Danlos Syndrome
  • Fibrous Dysplasia
  • Glaucoma
  • Hepatitis C
  • Hydrocephalus
  • Hydromyelia
  • Interstitial Cystitis
  • Inflammatory Bowel Disease (IBD), including Crohn’s disease and Ulcerative colitis.
  • Lupus
  • Migraines
  • Multiple Sclerosis (MS)
  • Muscular Dystrophy
  • Myasthenia Gravis

What is the Opioid Alternative Pilot Program and what are its requirements?

Illinois recently introduced a new medical marijuana program that allows qualifying patients to use medical cannabis as an alternative to opioids.

Registered patients can purchase 2.5 ounces of cannabis every 14 days, with certification renewal required after 90 days.

To qualify for the program:

  • Patients must be at least 21 years old and a resident of Illinois.
  • Patients must be certified by a licensed physician for a qualifying medical condition for which an opioid has been or could be prescribed.
  • Patients must pay a $10 government fee every 90 days for registration.

Veterans with a current prescription for an opioid who are receiving medical services at VA facilities are also eligible.

Retail Cannabis Licensing in Illinois

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

What state department is in charge of cannabis licensing in Illinois?

The Department of Financial and Professional Regulation (IDFPR) is in charge of cannabis licensing in Illinois. That said, the Cannabis Regulation Oversight Office (CROO) plays an active role in monitoring the day-to-day operations of cannabis businesses in Illinois.

What is the process for obtaining an adult-use dispensary license in Illinois?

The process for obtaining an adult-use dispensary license is slightly more complicated in Illinois than it is in other states.

As of March 2024, the Illinois Department of Financial and Professional Regulation (IDFPR) is using the Social Equity Criteria Lottery, a new application and lottery process designed to award social equity licenses to 55 applicants.

Social Equity


Once the applicants submit their online application and fee, they receive a unique number and receipt. The IDFPR will then publicly post the list of eligible lottery participants with their unique identifiers.

All eligible applicants are given 45 days to submit proof of their social equity status and operational requirements. After this, the IDFPR will conduct a lottery to select 55 top participants from 17 BLS regions. If all documentation is order, the 55 participants will be awarded a conditional license that enables them to start work on their retail dispensary as well as apply for an adult-use retail dispensary.

Dispensaries are not allowed to sell cannabis products on a conditional adult-use dispensary license.

What are the application fees and license costs for an adult-use cannabis retail license in Illinois?

The application process for the social equity license is online and costs $250. The full authority Adult Use Dispensing Organization (AUDO) license costs $60,000 for 2 years for regular (non-Social Equity) applicants.

There is also a $50,000 surety bond to be held in escrow.

For applicants who meet the Social Equity criteria the cost of an approved 2-year AUDO license is $30,000.

Illinois Dispensary Laws

Learn how to remain compliant with Illinois cannabis retail laws.

Where can a cannabis dispensary be located?

To ensure geographical dispersion of adult-use cannabis dispensaries, Illinois spreads out dispensary licenses among the 17 Bureau of Labor Statistics (BLS) Regions within the state. This means that, if approved for an adult-use dispensary license, you must locate your dispensary within the BLS Region identified on your application.

Once approved for a license, you will have 180 days to identify a physical location for your retail storefront. The location must be suitable for public access; have a layout that promotes the safe dispensing of cannabis; and be sufficient in size, power allocation, lighting, parking, accessible parking spaces, accessible entry and exits as required by the Americans with Disabilities Act, product handling, and storage. Additionally, the location must not be within 1,500 feet of an existing dispensary location.

Exceptions may be granted in special cases and social equity applications.

What is required of a dispensing organization before selling cannabis?

Before selling any cannabis or cannabis products, dispensary staff must:

  • Verify the age of the purchaser by checking a valid government-issued ID card by use of an electronic scanner
  • Offer any appropriate purchaser education or support materials
  • Enter the required information into the state’s electronic verification system, including the dispensary’s ID number, the dispensing agent’s ID number, the amount and type of cannabis or cannabis-infused product being sold, and the date and time of the sale

What are the purchase limits for medical marijuana patients?

Qualifying registered medical marijuana patients in Illinois may purchase up to 2.5 ounces of cannabis flower every 14 days. For concentrates, edibles, or other non-flower cannabis products, the pre-weight of the cannabis flower used to make the product counts toward the purchase limit.

What are dispensaries prohibited from selling?

Dispensaries cannot sell:

  • Any product containing alcohol except tinctures, which are limited to containers no larger than 100 milliliters
  • Clones or other live plant material
  • Cannabis, cannabis concentrate, or cannabis-infused products in combination or bundled with each other for one price

What taxes are collected on retail cannabis in Illinois?

Illinois is imposing a tiered tax rate on cannabis products, based on the THC content of the product. The tax rate for cannabis products is as follows:

  • 10 percent tax on cannabis flower or product containing less than 35 percent THC
  • 20 percent tax on all infused cannabis products, including edibles
  • 25 percent tax on any product with a THC concentration higher than 35 percent
  • When there are fewer than two people working in the dispensary

Additionally, the regular state sales tax of 6.25 percent will apply, along with local taxes of up to 3.5 percent

What are the laws regarding cannabis advertising and promotion in Illinois?

Cannabis businesses in Illinois may not engage in advertising that:

  • Is false or misleading
  • Promotes overconsumption of cannabis
  • Depicts the actual consumption of cannabis
  • Makes any health, medicinal, or therapeutic claims about cannabis
  • Includes the image of a cannabis leaf or bud
  • Includes any image designed or likely to appeal to minors, including cartoons, toys, animals, or children

Additionally, no cannabis business may advertise cannabis or cannabis products in any form:

  • Within 1,000 feet of a school, playground, recreation center, child care center, public park or library, or game arcade which allows persons under the age of 21
  • On or in a public transit vehicle or public transit shelter
  • On or in publicly owned or publicly operated property

Cannabis businesses, including retailers, are also prohibited from promoting the sale of cannabis products by giving away cannabis or cannabis products, conducting games or competitions related to consumption, or by providing promotional materials or activities that would be appealing to children.

When are dispensaries allowed to operate?

Dispensaries may operate between the hours of 6:00 a.m. and 10:00 p.m. Additionally, operations are prohibited under the following circumstances:

  • When video surveillance equipment is inoperative
  • When point-of-sale equipment is inoperative
  • When the state’s electronic verification system is inoperative
  • When fewer than two people are working in the dispensary

Cannabis Tracking, Reporting, and Inventory Control in Illinois

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

What are the tracking and reporting requirements for Illinois cannabis retailers?

Illinois cannabis retailers must establish an account with the state’s verification system that documents:

  • Each sales transaction at the time of sale
  • Each day’s beginning and ending inventory
  • Acquisitions of cannabis and cannabis-infused products
  • Disposal of cannabis

What are the inventory control system requirements for cannabis retailers in Illinois?

Cannabis retailers in Illinois must have an inventory control and point-of-sale system that is real-time, web-based, and accessible by the state at any time. Additionally, retailers must conduct a daily inventory reconciliation, documenting and balancing cannabis inventory by confirming that the state’s verification system matches the dispensary’s point of sale system and the amount of physical product at the dispensary.

What is the official state cannabis verification system in Illinois?

BioTrack provides statewide cannabis verification and monitoring in Illinois.

Is Cova compliant with Illinois' cannabis tracking, reporting, and inventory control requirements?

Yes, Cova's Cannabis Dispensary POS and inventory management system is fully compliant with BioTrack and Illinois’ cannabis tracking, reporting, and inventory control requirements.

Cova has all the features needed to keep Illinois dispensaries compliant, including:

  • Fully integrated inventory and sales tracking and reporting
  • Built-in product equivalency conversions and purchase limit enforcement
  • ID scanner for government-issued and patient ID card verification


Wrapping up this in-depth overview of Illinois, we’ve covered the latest legal and regulatory updates going into 2024, compliance requirements, retail licensure, and other key parts of cannabis law.

Although a fast-growing market, Illinois is facing many issues – from some of the most expensive cannabis in the country to operational challenges for operators, particularly transporters and craft growers. On the bright side, the state is taking active steps to maximize the state’s true potential.

2024 then should be a big year for new legal, regulatory, and operational changes for cannabis dispensaries in Illinois. Stay on top of this changing landscape – subscribe to the Cova newsletter for the latest updates & insights on cannabis retail regulations, trends, and technology.



Cannabis Business Lawyer & Founding Partner, Segev LLP

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Ron Segev is the founding partner of Segev LLP. A practical-minded business lawyer with expertise in the cannabis industry, he represents cultivators, dispensaries, CBD extractors, oil extractors, food processors, media and marketing companies, consultancies, and other businesses in the legal cannabis market.

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