On Absecon Island, Atlantic City became a popular playground for the Victorian rich from nearby New York City, NY and Philadelphia. It was also famous in the early twentieth century for the boardwalk and amusement piers, and since 1921 has hosted the Miss America pageant. The city went into decline after the Second World War owing to the westward shift in population and growing access to air travel.

In part to stem this decline, the city turned to gambling. A year after the passage of the Casino Gambling Referendum in 1976, casinos modeled on those in Las Vegas opened along the waterfront. Debate continues about the value of this scheme. Some argue that the casinos have brought new employment and business to a declining city Others maintain they have accelerated the displacement of poorer city residents, especially the long-established Northside African American community. This ambivalence is captured in the movie Atlantic City (1981), although without the racial dimensions.

In spite of opposition, casinos and gambling are firmly established. The leading casino owner, New York real-estate mogul Donald Trump, has persuaded the city to build a new highway tunnel to facilitate access to the newest of his four casinos. This will bring further displacement of residents and small businesses.

The city also hosted the 1964 Democratic Party Convention, at which the Mississippi Freedom Democratic Party tried unsuccess fully to force the party to seat the black delegates from Mississippi instead of the white-only delegates.