I think it's not illegal and legal because there are no rules about it.
I believe that depends on the current status of bitcoin and gambling separately in your State and Country. If you are allowed to gamble then you are not doing anything wrong, bitcoins just make gambling easier and there's nothing new with bitcoin gambling. I mean the casino remain same like sports betting or roulette and slot machine. Everything is same just the currency ( more correctly I should say Asset ) changed.