Stranraer has been selected as a potential location for a small-scale casino development.
Stranraer has been recommended for one of the small scale licences
It is one of eight locations across the UK backed to get one of the small permits by the Casino Advisory Panel.
Stranraer's was the only Scottish bid to be given the green light as another eight larger UK developments and one super-casino were given the go-ahead.
UK Culture Secretary Tessa Jowell will consult the Scottish Parliament before giving final approval for the bid.
The small-scale casinos can have up to 80 gaming machines with a maximum jackpot of £4,000.
The development is seen as part of plans to regenerate the waterfront area in light of Stena Line's move from the town to nearby Cairnryan.
Council convener Tommy Sloan gave the announcement a "cautious welcome".
"Obviously we are a long way away from the casino actually coming to Stranraer," he said.
"We have to speak to the community of Stranraer and district to make sure it is what they want to happen."
Mr Sloan said he hoped that the plans would progress.
"I would like to see Stranraer become the leisure town of south west Scotland," he said.
"But there are social problems that flow from casinos and we have got to put in place the wherewithal to deal with them."
Dumfries and Galloway Labour MP Russell Brown said it could help "kick-start" developments in the area.
The casino is seen as part of wider redevelopment of the area
"This announcement is a boost to the regeneration of Stranraer," he said.
"It will really help kick-start the development of the waterfront, bringing many jobs to the area and providing a huge boost to the local economy."
Mr Brown said the Dumfries and Galloway bid stood out from many other areas seeking a licence.
"The ferry link to Northern Ireland gave the Stranraer bid a real uniqueness," he said.
"Too many people simply pass through Wigtownshire to other parts of the country after they arrive on the ferry in Stranraer and Cairnryan."
Galloway and Upper Nithsdale Conservative MSP Alex Fergusson said it could be a "unique selling point" for the town.
"This is potentially a very good news story for the town at a time when good news stories are all too scarce," he said.
He stressed, however, that safeguards must be in place to avoid the dangers of gambling addiction.
In its findings, the CAP said it recognised there was evidence of rural deprivation in the area which could be addressed by the plans.
"We agree with the council that a casino development at Stranraer would offer a useful test of social impact in the context of the transformation of a port to a resort," said the panel's report.
"Dumfries and Galloway is stated to receive over one million tourist visitors a year, tourism is identified as important to the future of the area, and a themed towns approach is being developed.
"We agree that a casino in Stranraer would boost the aim of this strategy."