EXHIBIT 99.1


                                                      NEWS RELEASE
                                                      LAKES ENTERTAINMENT, INC.
[LAKES ENTERTAINMENT, INC. LOGO]                      130 CHESHIRE LANE
                                                      MINNETONKA, MN  55305
                                                      952-449-9092
                                                      952-449-9353 (fax)
                                                      WWW.LAKESENTERTAINMENT.COM
                                                      TRADED: NASDAQ "LACO"

- --------------------------------------------------------------------------------
FOR FURTHER INFORMATION CONTACT:
Timothy J. Cope 952-449-7030
- --------------------------------------------------------------------------------
FOR IMMEDIATE RELEASE:
Wednesday, January 7, 2004


            COURT ISSUES RULING ON SHINGLE SPRINGS CASINO RESOLVING
                           MOST ENVIRONMENTAL ISSUES


MINNEAPOLIS, JANUARY 7, 2004 -- LAKES ENTERTAINMENT, INC. (NASDAQ "LACO") today
announced a ruling by a California Superior Court in an environmental lawsuit by
El Dorado County and another group against the California Department of
Transportation (Caltrans) relating to the proposed casino project of the Shingle
Springs Rancheria (the Tribe). The Court ruled in favor of Caltrans on all of
the County's claims challenging Caltrans' environmental review of the proposed
casino project except that the Court asked for clarification on one issue.

The lawsuit was brought by El Dorado County and a group called Voices for Rural
Living (VRL), challenging Caltrans' approval of the proposed interchange on
Highway 50 to give the Tribe adequate access to its land. This interchange is
necessary for construction of the Shingle Springs casino project to be developed
and managed by Lakes. The challenge was based on the Tribe's environmental
documentation for the proposed interchange project and Caltrans' methodology of
environmental review in approving the project.

The Court ruled in favor of Caltrans on all of the claims made by the County and
VRL, except that the Court asked Caltrans to clarify whether the State
Implementation Plan for air quality demonstrates conformance with state air
quality standards as well as federal standards. The Court remanded the case to
Caltrans for clarification of this issue. Caltrans is presently determining
whether the State Implementation Plan considered state air quality standards. If
it did, Caltrans is expected to report such findings to the judge. Even if the
air quality agencies did not consider the state standards, Caltrans still has
the authority under California Environmental Quality Act to decide to proceed by
issuing a statement of overriding considerations and reporting this to the
judge. If Caltrans





                                      -4-





determines that the project will be in compliance with state standards or issues
a statement of overriding consideration then the interchange construction can
proceed after final Court approval.

This lawsuit is one of two filed by the county in an effort to stop the Tribe's
interchange and casino project. In the other lawsuit, El Dorado County's
challenge to the Tribe's status as a federally recognized sovereign nation and
its right to conduct gaming on the Rancheria was dismissed. The Court ruled that
the statute of limitations to challenge the Tribe's federal recognition had
expired. A federal environmental claim is continuing in connection with that
lawsuit.

Lyle Berman, Chairman and CEO of Lakes stated, "We are extremely pleased with
the Court's decision, which puts the Tribe in position to begin construction of
the interchange after Caltrans gathers the necessary information, makes a
favorable determination on the one remaining issue and the Court approves
Caltrans' ruling. We believe that the additional information needed by the Court
can be submitted and approved during the first half of 2004. Interchange
construction could begin immediately following the Court's approval with
construction of the casino beginning approximately 90 days later." Mr. Berman
continued, "We are ready to begin construction of this project and look forward
to its successful completion."

Lakes Entertainment, Inc. currently has development and management agreements
with four separate Tribes for four new casino operations, one in Michigan, two
in California and one with the Nipmuc Nation on the East Coast. Lakes
Entertainment also has agreements for the development of one additional casino
on Indian-owned land in California through a joint venture with MRD Gaming,
which is currently being disputed by the Tribe. Additionally, the Company owns
approximately 80% of World Poker Tour, LLC, a joint venture formed to film and
produce poker tournaments for television broadcast.

Lakes Entertainment, Inc. common shares are traded on the Nasdaq National Market
under the trading symbol "LACO".


- --------------------------------------------------------------------------------
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward-looking statements. Certain information included in this press
release (as well as information included in oral statements or other written
statements made or to be made by Lakes Entertainment, Inc.) contains statements
that are forward-looking, such as statements relating to plans for future
expansion and other business development activities as well as other capital
spending, financing sources and the effects of regulation (including gaming and
tax regulation) and competition. Such forward-looking information involves
important risks and uncertainties that could significantly affect anticipated
results in the future and, accordingly, such results may differ from those
expressed in any forward-looking statements made by or on behalf of the Company.
These risks and uncertainties include, but are not limited to, possible delays
in completion of Lakes' casino projects, including various regulatory approvals
and numerous other conditions which must be satisfied before completion of these
projects; possible termination or adverse modification of management contracts;
continued indemnification obligations to Grand Casinos; highly competitive
industry; possible changes in regulations; reliance on continued positive
relationships with Indian tribes and repayment of amounts owned to Lakes by
Indian tribes; possible need for future financing to meet Lakes' expansion
goals; risks of entry into new businesses; and reliance on Lakes' management.
For more information, review the Company's filings with the Securities and
Exchange Commission.
- --------------------------------------------------------------------------------




                                      -5-