Selling or possessing hemp-derived products containing more than trace amounts of delta-8 THC will be recriminalized starting July 31 in Texas.
This policy change on consumable hemp products comes after the Texas Department of State Health Services (DSHS) announced on July 10 that it would reinstate its 2021 definitions of THC and marijuana extracts following a Texas Supreme Court opinion on May 1 that delta-8 THC is a controlled substance. Only naturally occurring trace amounts in a hemp plant are exempt from the state’s controlled status, the court ruled.
While delta-8 THC exists naturally in small amounts, industry manufacturers often use a synthetic lab process to convert nonintoxicating CBD into intoxicating delta-8 THC, which is then infused into popular edible products sold at smoke shops, gas stations and convenience stores.
“Only trace amounts of delta-8 THC naturally produced by the hemp plant from which the consumable hemp product was manufactured are permissible,” DSHS clarified on its website this week. “The Texas schedule affecting delta-8 THC becomes effective July 31, 2026. This scheduling action reinstates clarifications to the definitions of tetrahydrocannabinols and marihuana extract made to the 2021 Schedule of Controlled Substances.”
The department stated that it plans to amend its consumable hemp product rules under the Administrative Procedure Act to include the 2021 definition of THC – that tetrahydrocannabinols means THC “naturally contained in a plant of the genus cannabis,” except for up to 0.3% delta-9 THC in hemp.
In other words, hemp-derived delta-9 THC products will remain legal in the Lone Star State, but products containing delta-8 THC or other synthetic cannabinoids, such as delta-10 THC or THCP, will be prohibited. The ban also applies to THCA flower, which many cannabis industry stakeholders argue is high-THC cannabis masquerading as hemp.
The 2021 definition banning delta-8 THC and other synthetic cannabinoids had been put on hold for the past five years, after Sky Marketing Corp., doing business as Hometown Hero, sued and won an injunction protecting delta-8 products. That injunction was lifted on May 28, following the Supreme Court decision.
As a result, the DSHS is picking up where it left off in 2021.
Hometown Hero CEO and co-founder Lukas Gilkey said that the DSHS, in 2021, had changed the rules on its website instead of going through a legislative process, an action that served as the genesis of the lawsuit.
Gilkey pushed back after the DSHS published its July 10 public notice of the 2026 rule change in the Texas Register.
“On the face of it, what the notice says is that cannabinoids that are not delta-9 are banned,” he said in a video post on social media. “That means that although other cannabinoids are being put on the Texas Schedule [of Controlled Substances], it does not apply to delta-9 in its current form. This comes from our 2021 lawsuit against DSHS where they admitted you cannot have delta-9 without trace amounts of other cannabinoids.”
Gilkey said there’s a lot of public confusion around the new rules, claiming that what the DSHS notice states is “not truly what it means” regarding the new policy’s legal impact.
“The normal process for the DSHS doing this would be to … allow the public to comment for a period of 30 days and then proceed with the filing,” he said. “They picked up where they left off in 2021 prior to our lawsuit and just immediately pulled up right up on the back end of that.”
This week, while the DSHS clarified that trace amounts of delta-8 THC would be allowed, it failed to define a “trace” amount.
“Consumable hemp products labeled to contain delta-8 THC or shown to contain more than trace amounts of tetrahydrocannabinols, including delta-8 THC, may be detained and referred to law enforcement,” according to the DSHS update. “In accordance with Texas Health and Safety Code 443, consumable hemp products may contain delta-9 tetrahydrocannabinol at a concentration of not more than 0.3 percent on a dry-weight basis.”
This policy change will interrupt a state marketplace that provides an estimated $10.3 billion economic impact for Texans, including the employment of more than 50,000 workers at thousands of businesses, according to Whitney Economics.
In Texas, the annual consumable hemp product license fee is $10,000 per location, while the hemp retailer registration fee is $5,000 per location. These retailers are required to verify that customers are 21 years or older before allowing them to purchase a consumable hemp product.
Possessing a Schedule I controlled substance in Texas, such as high-THC cannabis, is criminalized with the possibility of incarceration and hefty fines.
Police in Austin plan to treat unlawful delta-8 THC product possession as a felony offense, punishable by 180 days to two years in jail with a max fine of $10,000, KUT Public Media reported.
The DSHS policy change comes as broader attempts to ban all consumable hemp THC products failed during the 2025 legislative session.
