Swansea's hope for two casinos

It faces Glasgow, Blackpool, Brent, Greenwich, Manchester, Newcastle and Sheffield for the licence.

The city needs the casino win to finish the planned sports development in time for the 2012 London Olympics when it aims to be a host venue.

Newport did not make the regional list or win consideration for a smaller casino, unlike Swansea, which has.

In all, 17 new facilities will be located across the UK, including the first so-called super-casino.

Leader of Cardiff Council Rodney Berman said the Las Vegas-style venue - which would create 1,500 jobs - would be a launch-pad for the planned sports village in Cardiff Bay.

We remain focused on securing a regional casino in Cardiff which will put the international sports village on the map Council leader Rodney Berman

Cardiff has described its planned 80-acre waterfront sports development as "one of the most exciting sports and tourist venues in Europe, based around the themes of water, snow and ice".

The plans include a 50m swimming pool, an indoor snow facility, a 4,000-seat multi-purpose arena, ice rink and an artificial snow facility, hotels, bars and restaurants.

It is hoped it will attract 3.5m visitors a year, bringing �270m into the local economy and creating around 5,000 jobs.

Reacting to news of the shortlist, Rodney Berman said: "We remain confident that the Cardiff bid is a very strong one and with the links to the 2012 Olympics it is also unique.

"We remain focused on securing a regional casino in Cardiff which will put the international sports village on the map as a world class sporting and leisure destination, whilst supporting the UK's ability to successfully host the Olympics of 2012."

If Cardiff is not successful, the council has said it is likely to put the sports village plan back by up to five years.

Casinos like this are an entirely new concept for the UK and there are real fears about the impact they may have on crime and gambling addiction Lisa Francis AM

Welsh Secretary Peter Hain: "This news could potentially bring huge benefits to Wales, providing economic regeneration and bringing in hundreds of new jobs."

The official bid for the casino was launched on St David's Day, with the backing of six former Olympians. They highlighted how landing the project would boost its sports village development enabling Cardiff to become an Olympic host city.

But the news was greeted with caution by Welsh Conservatives.

Newport and Swansea

Welsh Conservatives' culture spokeswoman Lisa Francis AM said: "While we wish Cardiff well in its bid, every effort must be made to tackle issues relating to gambling addition.

"Casinos like this are an entirely new concept for the UK and there are real fears about the impact they may have on crime and gambling addiction."

Meanwhile, Newport council said it was "obviously disappointed" to miss out.

Council leader Bob Bright said: "Our city will still continue to grow and improve through the exciting redevelopment schemes which are already under way."

The new Gambling Act allows for only one regional super-casino, but Cardiff and other councils are calling for the number to be increased to the eight originally suggested.