Is gambling legal? Or it is not prohibited? I would say it is not prohibited, which means you are not committing a crime if you participate in such activities. But I think that Bitcoin gambling will not be legal any time soon, because need certain set of laws and regulations which are complicated. This is not in anybody's daily agenda for the moment.
Depending where you live then it may or may not be legal. But usually gambling is legal in most countries, so I think the best thing to do is to do your own research before you even gamble. Bitcoin and gambling are different things, but if you play on a bitcoin gambling site, then you have to check whether gambling is legal or whether bitcoins are legal in your jurisdiction. It just gets a whole lot more complicated. But generally right now there aren't much countries that has declared bitcoins illegal, so not really something to worry about there.