The big kickoff for riverboat casino laws was the Indian Gaming Regulatory Act of 1988, providing "... a statutory basis for the operation of gaming by Indian tribes as a means of promoting tribal economic development ..." and making a Federal authority regulating gaming.

This meant casinos could now start appearing on reservations, and some states without any were concerned about losing revenue from people traveling to other states. Iowa (bordered by Minnesota and Wisconsin, which had tribal casinos opening) was the first to pass such a law in March 1989. Legislators felt the casinos might aid the local economies while simultaneously tapping into the "riverboat gambler" mythos of the South.

The floodgate opening caused Mississippi to follow with their own law the same month (which does have reservation land, but the economic / cachet reason combined with the "protective bubble" already being broken was good enough). Not wanting to miss out, Louisiana, Indiana, and Missouri followed fairly swiftly after. (Note that the one you're asking about, Missouri, which I'll talk about in more detail later, does not have any reservation land.) By 1994 there were 57 riverboat casinos along the Mississippi river.

Your question seems to be "why not land casinos?" In addition to the already mentioned mythos, locations along the River itself had some economic woes, especially as there was a decline in the Gulf of Mexico oil along this time, so this led it to be a more targeted effect. Additionally there were also still the general concerns of organized crime, which were still strongly associated with casinos; while the Mob's influence in Las Vegas was starting to wane by a stronger push from law enforcement and the entrance of big corporations in the late 1960s (and quite helpfully, the Nevada Corporate Gaming Act which made it possible for corporations to have casinos without all the shareholders being licensed) there will still mafia groups skimming from casinos up into the 1980s.

So there was some trepitation about being able to build casinos anywhere. Even the IGRA which set the riverboat-fever off mentions the mafia problem specifically; the policy is specifically built "to shield it from organized crime and other corrupting influences".

In Nevada, "suitability standards" help keep the Mafia from coming back; a gaming license requres the person wanting one to be

a.) a "person of good character"

b.) a "person whose background, reputation and associations will not result in adverse publicity"

c.) a person with "adequate business competence and experience"

This allows, in other words, people with any organized crime links to be kept out. For example, Frank Rosenthal, who was associated with the Stardust, was (after some arrests) brought before the Gaming Commission who noted

Certain questions regarding your past and your background have been brought up, and the burden is your[s] to come forward and tell us that those items or true or explain how they could have arisen.

Even with these mechanisms, as I said, it took until the 1980s to purge the organized crime elements. So there was an understandable element of nervousness to allowing gambling and by approving individual riverboats in a fixed area it allowed legislators to maintain strong control.

Not like it removed the possibility of organized crime! Illinois in 2001 had a big fight over a casino built by Emerald Casino, Inc. in Rosemont, which led to two members of the Gaming Board being replaced by the Governor who was (according to opponents of the casino) trying to "stack the deck". Particularly troubling were links between the mayor of Rosemont (Donald Stephens) -- who had been pushing for a new riverboat casino for years -- and the mafia boss Sam Giancana. (The story gets messy after that; an MGM purchase fell through, and the group ended up in bankruptcy court.)

As far as why the riverboat laws, once passed, started to get chipped away from, it's pretty much simply potential money to the state combined with intense lobbying from the gambling industry. The most recent law change in Louisiana (simplifying rules allowing the boats to be docked) arose because -- according to a representative in debate -- they were "taking a beating" from "Indian tribes in southern Oklahoma" who were "building huge casinos on the (Texas-Oklahoma) border".

Let's get into a Missouri example specifically, the one that was most contentious--

...

For Missouri, the riverboat gambling was authorized on November 3, 1992 by voters with 62% of the vote. Note that this still didn't quite allow games of "chance" yet, only games of "skill". (This means that slot machines with no choices at all, the most profitable kind, were not allowed.) April 1993 had the Senate Bills 10 and 11 which allowed "gambling games" to have a wide definition and created the Missouri Gaming Commission. This was immediately followed by a lawsuit filed by gambling opponents, Harris v. Missouri Gaming Commission, which went to the Supreme Court of Missouri and found that games of chance on riverboats were in fact unconstitutional.

This was followed immediately by the legislature creating an amendment to the Constitution, which needed to be approved by voters, and despite a humungous expenditure by the gambling industry, the amendment was defeated in 1994.

The gambling industry was undeterred and managed to get the amendment on the ballot for a second time, which finally won out with a 54% majority in November in 1994 authorizing "...games of chance to be conducted on excursion gambling boats and floating facilities.” (The amount of state revenue specifically floating for having the law was floated as $30 million per year.)

This led to yet another lawsuit in 1997, Akin v. Missouri Gaming Commission, again finding the licensing to be unconstitutional (basically, it created a new category of riverboat rather than removing the other one) so this led to another amendment in 1998 finally overriding any legal challenges once and for all.

Note that through all this there were allowed to be riverboat casinos! Just not ones that had the highly profitable (and also most addictive) "games of chance". Any much smaller laws (like allowing for continuous boarding starting in the late 90s) involved not nearly as much a fight, but still had the twin forces of money and lobbying involved. When I said "humungous expenditure" regarding the first (defeated) bill I meant it: gambling proponents outspent opponents 60 to 1.

...

Larsen, L. H., Kirkendall, R. S. (2004). A History of Missouri: 1953 to 2003. United States: University of Missouri Press.

Nelson, M., Mason, J. L. (2007). How the South Joined the Gambling Nation: The Politics of State Policy Innovation. United States: LSU Press.

O'Connor, C. T. (2000). A Return to the Wild West: The Rapid Deregulation of the Riverboat Casino Gambling Industry in Missouri. Louis U. Pub. L. Rev., 19, 155.

Prideaux, B., Cooper, M. (ed.) (2009). River Tourism. United Kingdom: CABI.