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Presently, horse racing in Japan is classified into two categories: racing conducted by the Japan Racing Association (JRA), and racing conducted by local governments on the prefectural and municipal level. JRA racing provides revenue to national treasury, while racing by local governments provides revenue to certain designated local governments.Racing by local governments has a history of more than 90 years, and has developed into its present form.

It was in 1861, towards the end of the era of the Tokugawa Shogunate, that Western-style horse racing was introduced into Japan. The first race was conducted in Yokohama under the auspices of the Yokohama Race Club, which was formed by a group of foreign residents of that city. This was followed by Western-style races in Tokyo and Hakodate. In 1888, with Japan Racing Club (formerly the Yokohama Race Club) having put for the first time in Japan one-dollar betting tickets on sale for club-sponsored races in Yokohama, the popularity of Western-style racing grew throughout the country.Subsequent years witnessed both a period when betting was given tacit approval by the government, and a period when, though betting was prohibited, racing received government subsides for the promotion of the livestock industry. With the promulgation of the Horse Racing Law in 1923 began the period of "authorized horse racing " in Japan, and the approved sales of betting tickets at 11 difference clubs.

Racing by local governments developed mainly as a form of public entertainment, from the ceremonial horse racing which had been dedicated since ancient times to local temples and shrines at festivals around Japan.The recorded history of racing in Japan can be traced as far back as 701 A.D., during the reign of the Emperor Mommu. As time passed, horse racing developed into such Imperial Court-sponsored forms as "Kurabe-Uma" ("match races") at Butokuden pavilion, race for religious ceremonies at Kyoto's Kamo Jinja, and other shrines, and road races sponsored by court nobles.Although horse racing with roots in religious ceremony was officially approved by the national government in 1910 to be conducted by the Livestock Association as a form of public entertainment, the sales of betting tickets were not permitted at that time.However, with the subsequent growth in popularity at approved horse racing, the sales of betting tickets were eventually permitted for such races. Horse racing continued to flourish in Japan, reaching a peak in the early 1940's, before the out break of World War.

A new Horse Racing Law was promulgated after World War , in 1948.With the dissolution of the Japan Racing Society, which had been established through the unification of a number of race clubs, and which had exclusively operated horse racing in Japan, horse racing which had thus far been officially approved was changed over to a nationally operated form of racing under the direct control of the national government. After that, in 1954, the government established JRA, a semi-governmental corporation, to conduct all aspects of horse racing. This has since developed into the horse racing which is conducted by JRA of today. On the other hand, in accordance with the new Horse Racing Law promulgated in 1948, races conducted by private equine organizations at that time were placed under the direct jurisdiction of local governments. In order words, these races were what are referred to today as " Racing by local governments". Due to the fact that the operation of horse racing has been changed from the control of private equine organizations to that of local governments, the level of trust enjoyed by racing by local governments increased, while the sport itself has developed greatly.