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Online casinos, also known as virtual casinos or Internet casinos, are online versions of traditional ("brick and mortar") casinos. Online casinos enable gamblers to play and wager on casino games through the Internet. Some online casinos claim higher payback percentages for slot machine games, and some publish payout percentage audits on their websites.

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Assuming that the online casino is using an appropriately programmed random number generator, table games like blackjack have an established house edge. The payout percentage for these games are established by the rules of the game.

Online casinos are broadly divided into two categories based on the software they use: web-based and download-only casinos. Traditionally, online casinos would include only one of the two platforms.

However, with advanced technological changes, an online casino can now accommodate both. Web-based online casinos (also known as no-download casinos) are websites where users may play casino games without downloading software to their local computer.

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A stable internet connection is required to have a seamless gaming experience as all graphics, sounds, and animations are loaded through the web. Most online casinos allow gameplay through an HTML interface, previously this was done through browser plugins, such as Flash Player, Shockwave Player, or Java.

Download-based online casinos require the download of the software client in order to play and wager on the casino games offered. The online casino software connects to the casino service provider and handles contact without browser support.   Download-based online casinos generally run faster than web-based online casinos since the graphics and sound programs are cached by the software client, rather than having to be loaded from the Internet.  

On the other hand, the initial download and installation of the casino's software take time.

As with any download from the Internet, the risk of the program containing malware exists, which makes it less popular among skeptical casino players. Also known as software-based online casino games, the outcome of these games is determined using a pseudorandom number generator (PRNG) software.

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This software ensures that every deal of the card, the outcome of a dice throw, or the results produced by the spinning of a slot machine or roulette wheel is totally random and unpredictable. PRNGs use a set of mathematical instructions known as an algorithm to generate a long stream of numbers that give the impression of true randomness. While this is not the same as true random number generation (computers are incapable of this without an external input source), it provides results that satisfy all but the most stringent requirements for true randomness.

When implemented correctly, a PRNG algorithm such as the Mersenne Twister will ensure that the games are both fair and unpredictable.