In August, World Trade Organization judges gave the U.S. until Monday to address its criticisms after finding that the ban, in the interests of "`public morals", can stand only as long as the prohibitions don't discriminate against foreign companies.

The U.S. said it could comply by "clarifying" its restrictions on horseracing, without opening itself to foreign Internet gambling.

Antigua-registered companies such as Sportingbet Plc and BetWWTS.com account for about a quarter of wagers in the $12 billion global industry. The islands developed online gambling to boost a tourism-dependent economy after a series of hurricanes.

U.S. residents account for about 55 percent of online bets and WTO sanctions are usually calculated as a share of damages.

"We're talking a big figure, a very significant figure, and we intend to back it up and get some benefit out of this," Mark Mendel, chief legal counsel to Antigua, said in an interview from his office in El Paso, Texas. "I don't know what else to do, but it's unbelievable, they say they've done nothing but are in compliance" with the WTO ruling.

Antigua, a nation of 70,000 people and the smallest government ever to lodge a WTO dispute, scored its victory against U.S. online gambling restrictions in November 2004, when the WTO said that the U.S. had committed itself to open the industry in 1995.

'Mature Trading Partner'

"As a mature trading partner, the U.S. should be held accountable for its actions and be required to live up to its responsibilities," Errol Cort, Antigua's finance minister, said in an e-mailed statement, echoing comments made last week by U.S. Trade Representative Rob Portman about China.

Sanctions may be difficult to impose. In a dispute over access to the European Union's banana market, Ecuador, the world's biggest exporter of the fruit, couldn't afford to impose WTO-approved sanctions because they would have damaged its economy.

Any retaliation targets will have to include a full range of commercial services and industrial goods imports from the U.S., Mendel said, without specifying the value of the damages he would file by the end of the month.

Brazil last year filed WTO claims for sanctions worth as much as $4 billion against U.S. financial and engineering services, trademarks and patents in retaliation for subsidies to American cotton farmers.

If applied, the sanctions would be the first time any of the WTO's 149 governments retaliated by targeting commercial services and property rights rather than increasing tariffs on goods.