The Kaho'olawe Island Reserve Commission, a state agency, manages the island, the submerged lands and the surrounding waters, extending two miles from the shoreline. In April 2004, the Navy ended its 10-year cleanup of unexploded ordnance on Kaho'olawe. However, an estimated one-third of the island is yet to be cleared. It is not uncommon to find unexploded ordnance exposed by erosion, and there was no unexploded ordnance cleanup in the waters surrounding Kaho'olawe. Consequently, Kaho'olawe continues to be unsafe for public use, and access to the island is permitted only for cultural and environmental restoration purposes.

Under law, the Kaho'olawe Island Reserve is restricted to the following specific uses: (1) preservation and practice of all rights customarily and traditionally exercised by Native Hawaiians for cultural, spiritual and subsistence purposes; (2) preservation and protection of the island's archaeological, historical and environmental resources; (3) rehabilitation, revegetation, habitat restoration and preservation; and (4) education. Commercial uses, which would include gambling, are strictly prohibited. The law also provides eventual transfer of the Kaho'olawe Island Reserve to the sovereign Native Hawaiian entity.