Environmental concerns form part of the reasoning which could see Hokkaido withdraw its proposal to host an integrated resort, Japan Times reports.
Governor Naomichi Suzuki is expected to announce the resolution on Friday, after he previously said a decision would be made by the end of the year.
The proposal included plans to build on a site in Tomakomai, although residents of the region voiced concerns over the environmental impact an integrated resort could have there.
The proximity of the proposed construction site to Lake Utonai, a wildlife sanctuary and important wetland, is one of the main environmental issues.
A petition aiming to block the casino’s construction was drafted by a citizen's group and has so far collected 20,000 signatures.
The integrated resort has received some support in Hokkaido; businesses saw it as a potential boost to the local economy.
The Wakayama and Nagasaki Prefectures and cities Osaka and Yokohoma have declared their interest in hosting an integrated resort. Tokyo, Chiba and Nagoya are also submitting applications.
The Central Government plans to select three locations to allow integrated resorts to be built and will base this decision on capabilities to attract foreign visitors.