South Dakota Cannabis Regulatory Landscape

No. South Dakota has legalized medical cannabis but has not legalized adult-use cannabis. Qualified patients with a valid medical cannabis card may legally purchase and possess cannabis through licensed dispensaries. Commercial cannabis businesses must be licensed and comply with South Dakota Department of Health (DOH) regulations.

The South Dakota Department of Health (DOH) administers the state's Medical Cannabis Program and oversees the licensing and regulation of medical cannabis businesses.

South Dakota uses Metrc as its official seed-to-sale track-and-trace system. Licensed medical cannabis businesses must use Metrc to track inventory, transfers, and other regulated activities in compliance with South Dakota Department of Health (DOH) requirements.

Within its medical cannabis program, South Dakota licenses four types of establishments:

• Cultivation Facilities
• Manufacturing Facilities
• Medical Dispensaries
• Testing Laboratories

Each annual medical cannabis establishment license—whether for cultivation, manufacturing, dispensary, or testing lab—charges a $5,000 application fee when applying and the same $5,000 for renewal, as of 2025.

To apply, you must submit an application through the South Dakota Department of Health’s Medical Cannabis Program. The process includes a $5,000 fee, background checks, and detailed plans for security, operations, and facility layout. Applications are reviewed by the state and may include a site inspection before approval. Additional registration and operational requirements may be required at the local level.

Violations can result in civil penalties, suspension, or revocation of their license for offenses like improper inventory tracking, advertising violations, or failure to maintain required records. 

The Department of Health can impose fines on a medical cannabis establishment that is found to have committed multiple or serious violations of up to ten thousand dollars per inspection.

Operating without a valid license or outside authorized limits can lead to felony charges with penalties that may include up to 10 years in prison and $20,000 in fines.

Our software reduces data entry errors, helping your business stay compliant with South Dakota’s medical cannabis regulations. We’ve built in 'guard rails' that METRC doesn’t have,making it easier for your team to enter track-and-trace data accurately and in real time. If something goes wrong, you can quickly undo actions and correct mistakes without disrupting operations. Plus, our team brings over 20 years of METRC experience and is always ready to help you stay on track.