Congress has again declined to impose a broad federal override of state artificial-intelligence laws. Republican leaders abandoned an attempt to attach state-regulation restrictions to the FY 2026 National Defense Authorization Act after bipartisan opposition, and House Majority Leader Steve Scalise said supporters could try another legislative vehicle. The defeat lowers the immediate risk of a blanket moratorium, but it is not a final settlement: the administration is pursuing the same objective through executive agencies, litigation, funding leverage and new legislation.
What failed in the defense bill
The immediate fight was over language that would have limited states’ ability to enforce AI regulations by attaching the restriction to the annual defense authorization bill. It was not a standalone AI statute. Republican leaders withdrew or abandoned the provision after lawmakers from both parties objected, according to TechCrunch’s December 3, 2025 report.
That procedural defeat matters, but it does not mean Congress permanently rejected federal preemption. It means this particular provision and legislative vehicle failed. Scalise indicated that supporters might pursue similar language elsewhere.
The earlier 10-year moratorium
The NDAA episode followed a broader attempt in the 2025 budget-reconciliation bill. On July 1, the Senate voted 99–1 to remove a proposed 10-year prohibition on many state AI laws. Democratic Sen. Maria Cantwell and Republican Sen. Marsha Blackburn sponsored the amendment that stripped the moratorium, a sign that concern about the proposal crossed party lines. The vote and the amendment’s scope are described by the Senate Commerce Committee.
Opponents warned that a decade-long pause could stop states from enforcing protections involving deepfakes, robocalls, autonomous vehicles, consumer protection and other harms before equivalent federal safeguards existed. The vote was not a rejection of every form of federal coordination; it was a rejection of a sweeping moratorium in that bill.
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Why supporters want federal preemption
Technology companies and their allies generally argue for one national rulebook rather than fifty potentially different regimes. A company operating across the United States may have to meet separate requirements for:
- Notices and disclosures when people interact with AI;
- Model testing, audits and incident reporting;
- Employment and automated decision systems;
- Deepfakes and synthetic media;
- Privacy, safety and liability; and
- Sector-specific uses in health care, education or finance.
Industry’s more precise position is usually uniform federal regulation, not an absence of regulation. Supporters say a national framework could reduce duplicative compliance work, make product design more predictable and reflect the fact that digital services cross state borders. Those arguments were presented in congressional testimony, including House testimony on national AI policy.
Why opponents resist a blanket override
Critics say preemption would remove protections before Congress supplies substitutes. State statutes often address a particular conduct or population rather than “AI” as an abstract technology: hiring decisions, health-care tools, children’s interactions with chatbots, political deepfakes, consumer disclosures and government procurement.
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States have also acted as policy laboratories when federal legislation stalled. A broad moratorium could prevent them from responding quickly to newly identified harms, and a long pause could become a de facto permanent gap if Congress never completes a replacement framework. The central disagreement is therefore who should regulate, how broad the federal override should be and whether federal safeguards would be strong enough to displace state rules.
Executive Order 14365 changed the strategy
On December 11, 2025, President Donald Trump signed Executive Order 14365. The order did not itself erase state AI statutes or create a universal statutory preemption regime. Instead, it set out an administrative campaign to identify, pressure and challenge state laws while asking Congress to enact a federal framework. The order’s text directs several separate actions.
Litigation Task Force
The attorney general must create an AI Litigation Task Force to challenge state laws the administration views as unconstitutional, preempted or otherwise unlawful. A lawsuit targets a particular statute and legal theory; it does not automatically invalidate every similar law in the country.
Commerce Department review
Commerce is instructed to evaluate state AI laws considered inconsistent with the administration’s policy and to identify laws that could be challenged or addressed through federal action.
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Funding leverage
The order directs Commerce to develop, to the maximum extent allowed by federal law, conditions affecting certain non-deployment Broadband Equity, Access, and Deployment (BEAD) funds. Agencies are also told to assess whether discretionary grants can be conditioned on a state’s not enacting or enforcing conflicting AI laws. Any such condition must fit existing statutory authority; an executive order cannot create unlimited spending power.
FCC and FTC proceedings
The Federal Communications Commission is directed to consider a federal reporting and disclosure standard that could preempt conflicting state requirements. The Federal Trade Commission is directed to issue a policy statement concerning state laws that allegedly require deceptive conduct by AI models. Agency guidance or proceedings may influence enforcement, but they do not have the same legal effect as a statute enacted by Congress.
A request for legislation
The order asks for a legislative recommendation establishing a federal framework that preempts conflicting state laws. It generally identifies child-safety protections, AI compute and data-center infrastructure (apart from generally applicable permitting reforms), and state government procurement and use of AI as areas that should be preserved, while leaving other carve-outs to be determined.
What an executive order can—and cannot—do
Under the order’s own terms, implementation must be consistent with applicable law, and it creates no privately enforceable right or benefit. The administration can prioritize litigation, direct agencies to use authority Congress has already granted, and propose funding conditions where federal statutes permit them. It cannot simply declare every state AI law void.
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Whether a particular law survives will depend on the statute’s language, the regulated conduct, the federal authority invoked and the result of any court case. Until a court blocks a law, a state repeals it or Congress enacts valid preemption, the law generally remains operative.
What state AI rules remain relevant
“State AI law” is not one category. Existing or emerging rules may govern:
- Automated hiring, promotion and workplace decisions;
- Consumer notices, disclosures and unfair or deceptive practices;
- Deepfakes, election content and synthetic media;
- High-risk or frontier models;
- Health-care and education systems;
- Children’s use of AI companions or chatbots;
- Government procurement and deployment; and
- Data use, audits, transparency and incident reporting.
A future federal statute could preempt some categories while preserving others. A generally applicable fraud, discrimination, product-liability or employment rule may regulate conduct rather than AI technology itself and therefore raise different preemption questions. A state may also regulate its own purchasing decisions without imposing requirements on private developers.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What Congress may try next
The failed NDAA provision is unlikely to be the last proposal. Possible vehicles include:
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- An appropriations, telecommunications or national-security bill that must pass;
- A targeted preemption bill covering only specified model-development requirements;
- A temporary moratorium designed to give Congress time to legislate; or
- A compromise with explicit state-law carve-outs.
H.R. 5388, the American Artificial Intelligence Leadership and Uniformity Act, illustrates one approach: its introduced text proposed a five-year state-law moratorium with provisions concerning state procurement and generally applicable criminal law. It is a proposal, not enacted law; see the Congress.gov text.
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Other lawmakers have proposed protecting state authority instead. S. 3557, the States’ Right to Regulate AI Act, would bar federal funds from being used to implement or enforce Executive Order 14365. It was introduced and referred to committee, not enacted; its text is available on Congress.gov.
Reporting in June 2026 described a renewed White House–Congress effort to negotiate some form of preemption while states continued adopting AI measures. Axios reported on the relaunch, and the Washington Post described continued state activity amid federal pressure.
The legal fault lines
Future disputes are likely to turn on several distinct doctrines:
- Commerce Clause: whether a state law impermissibly burdens interstate commerce.
- Federal preemption: whether Congress expressly displaced state law, occupied the field or created a conflict that makes compliance impossible.
- First Amendment: whether disclosure, output or content rules regulate protected expression.
- Spending power: whether a grant condition is authorized, related to the program and not coercive.
- Agency authority: whether the FCC, FTC or another agency has delegated power to displace state requirements in a particular sector.
- Severability: whether a court can remove one invalid provision while leaving the rest of a state statute in force.
Those questions make a categorical prediction unreliable. Two laws both described as “AI regulation” may have different regulated entities, purposes and constitutional outcomes.
Practical implications
For companies and compliance teams
- Continue state-by-state compliance; neither the failed NDAA effort nor Executive Order 14365 is enacted blanket preemption.
- Map obligations by activity—development, deployment, employment, health care, education, consumer services and government contracting.
- Track effective dates, enforcement provisions, agency notices and litigation in each state where products or customers operate.
- Design products and documentation flexibly enough to accommodate a targeted federal statute or a court decision.
For state officials
- Expect constitutional and preemption challenges, as well as possible federal-program pressure.
- State clearly whether a law regulates conduct, a sector, a high-risk use or a model-development practice.
- Use severability clauses and explicit jurisdictional findings so a court can preserve lawful provisions.
For readers and policymakers
The congressional defeats reduce the immediate chance of a blanket moratorium, but they do not end the federal-versus-state dispute. Existing federal statutes and sector rules continue to matter even without a comprehensive AI law.
Bottom line: “for now” is the operative phrase
The December 2025 defense-bill maneuver failed, and the Senate had already removed a 10-year moratorium by a 99–1 vote. Those are real legislative setbacks for broad preemption, not a permanent victory for state regulators. The administration’s executive-order strategy—litigation, agency review, funding leverage and a push for new legislation—keeps the issue active. Until Congress enacts a valid preemption law or a court blocks a specific state statute, state AI requirements remain part of the compliance landscape.
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