Colorado AI Act
In plain wordsA Colorado law, first passed in 2024, governing AI used to make important decisions about people, such as hiring, lending and housing. In 2026 it was rewritten as a narrower law that starts in 2027.
Colorado's statute on AI used in 'consequential decisions' about consumers: those that materially affect a person's access to, or the terms of, jobs, housing, lending and other financial services, insurance, health care, schooling, legal services or essential government services. As enacted in 2024 (SB 24-205), it was the first comprehensive US state law on high-risk AIhigh-risk AI system, n.: Under EU law, an AI system used where mistakes could seriously hurt people's safety or rights — in hiring, schooling, loans, policing, borders or products like medical devices — and which must therefore pass strict checks.: developers and deployers owed consumers a duty of reasonable care against algorithmic discriminationalgorithmic bias, n.: Unfairness in software that judges or serves people: it consistently produces worse results for some groups, such as women, older people or ethnic minorities, often because it learned from skewed or incomplete records.; deployers needed risk-management programs and annual impact assessmentsalgorithmic impact assessment, n.: A structured review, done before and during the use of an automated system, of whom it could affect and how — such as unfair treatment or privacy harms — and what will be done about it., had to tell people when AI was used and offer correction and appeal; and discovered discrimination had to be reported to the Attorney General. Its start was postponed to June 30, 2026, but it never took effect. In May 2026 it was repealed and re-enacted by SB 26-189, effective January 1, 2027, which regulates automated decision-making technologyautomated decision-making, n.: When a computer system, rather than a person, makes or effectively makes a decision about someone — such as approving credit, screening job applicants or flagging possible welfare fraud. in consequential decisions through developer documentation, notice to consumers, a plain-language explanation within 30 days of an adverse outcome, rights to correction and human review, and fault-based allocation of liability, enforced only by the Attorney General after a 60-day cure period. It drops the duty of care and impact assessments.
Under the rewritten Colorado AI Act, the lender must explain the model's role within 30 days of a denial.
Origin
Sponsored by Senate Majority Leader Robert Rodriguez and Representatives Brianna Titone and Manny Rutinel and signed with reservations by Governor Jared Polis on May 17, 2024. Business objections led to a delay in an August 2025 special session. xAI sued to block the law in federal court on April 9, 2026, the US Justice Department filed a companion complaint on April 24, enforcement was paused by a stipulated order on April 27, 2026, and Polis signed the replacement on May 14, 2026.
Usage note
A focal point of the AI preemptionAI preemption, n.: The push in the United States for a single national AI law that would override the states' own AI laws, and the fight over whether that is wise or even lawful. fight: the federal government argued that its anti-discrimination and disclosure rules compelled speech and imposed race- and sex-conscious obligations. Many US compliance programs had been built for the 2024 version, which, as of October 2026, no longer exists in that form.
Related
- automated decision-makingautomated decision-making, n.: When a computer system, rather than a person, makes or effectively makes a decision about someone — such as approving credit, screening job applicants or flagging possible welfare fraud.
- algorithmic impact assessmentalgorithmic impact assessment, n.: A structured review, done before and during the use of an automated system, of whom it could affect and how — such as unfair treatment or privacy harms — and what will be done about it.
- high-risk AI systemhigh-risk AI system, n.: Under EU law, an AI system used where mistakes could seriously hurt people's safety or rights — in hiring, schooling, loans, policing, borders or products like medical devices — and which must therefore pass strict checks.
- AI preemptionAI preemption, n.: The push in the United States for a single national AI law that would override the states' own AI laws, and the fight over whether that is wise or even lawful.
- Texas Responsible Artificial Intelligence Governance ActTexas Responsible Artificial Intelligence Governance Act, prop. n.: A Texas law, in force since 2026, that bans a short list of harmful uses of AI — such as pushing people toward self-harm or making sexual deepfakes of children — and sets rules for government use of AI.
- algorithmic biasalgorithmic bias, n.: Unfairness in software that judges or serves people: it consistently produces worse results for some groups, such as women, older people or ethnic minorities, often because it learned from skewed or incomplete records.
- EU AI ActEU AI Act, prop. n.: The European Union's law on artificial intelligence, the first broad AI law anywhere: it bans some uses, sets strict checks for risky ones and puts duties on the makers of the biggest AI models.
Sources
- Colorado General Assembly (2024). SB24-205: Consumer Protections for Artificial Intelligence.
- McDermott Will & Schulte (2026). Colorado AI law in flux: Comprehensive replacement bill signed after federal court blocks predecessor's enforcement. mcdermottlaw.com/insights/colorado-ai-law-in-flux-comprehensive-replacement-bill-signed-after-federal-court-blocks-predecessors-enforcement
Defined in law or standards
Colorado SB 24-205 (2024), C.R.S. § 6-1-1701 et seq.; repealed and re-enacted by SB 26-189 (signed May 14, 2026; effective January 1, 2027)
Mentioned in
AI preemptionAI preemption, n.: The push in the United States for a single national AI law that would override the states' own AI laws, and the fight over whether that is wise or even lawful., algorithmic accountabilityalgorithmic accountability, n.: The idea that the people and organizations behind automated decision systems must be able to explain and justify those systems' effects, answer for the harm they cause, and fix it., algorithmic impact assessmentalgorithmic impact assessment, n.: A structured review, done before and during the use of an automated system, of whom it could affect and how — such as unfair treatment or privacy harms — and what will be done about it., automated decision-makingautomated decision-making, n.: When a computer system, rather than a person, makes or effectively makes a decision about someone — such as approving credit, screening job applicants or flagging possible welfare fraud., NIST AI Risk Management FrameworkNIST AI Risk Management Framework, prop. n.: A free, voluntary guide from the US government's standards agency that helps organizations spot, measure and reduce the risks of the AI systems they build or use., automated employment decision toolautomated employment decision tool, n.: Software that scores, ranks or screens job candidates or employees. New York City requires employers using such tools to have them checked for bias every year and to tell applicants., Texas Responsible Artificial Intelligence Governance ActTexas Responsible Artificial Intelligence Governance Act, prop. n.: A Texas law, in force since 2026, that bans a short list of harmful uses of AI — such as pushing people toward self-harm or making sexual deepfakes of children — and sets rules for government use of AI.