People walk by a convention center on the boardwalk in Atlantic City, N.J., in July. Since January, four of city's casinos have moved to close. Getty Images
Early Tuesday morning, gamblers at the Revel Casino Hotel will be asked to leave, and security guards will take over at the gleaming, 47-story building on the north end of the boardwalk.
The sudden closing of the two-year-old Revel, plus two other casinos shutting their doors in the next few weeks, marks the end of Atlantic City's decades-long reliance on gambling to stay afloat.
When Atlantic City opened its first casino in 1978, state and local officials talked up gambling as the path to revival for a shore resort plagued by high unemployment and white flight to the suburbs. While the city had its moments—even surpassing the Las Vegas Strip in gambling revenue for much of the 1980s and 1990s—many politicians, residents and business people are giving up on the dream.

"Looking back, people should have been preparing for this day for the past couple of decades," said John Palmieri, who leads the New Jersey state redevelopment efforts here, citing the proliferation of gambling locations across the U.S.The city is bracing itself for the loss of more than 6,000 jobs at the Revel, Showboat and Trump Plaza, and collateral damage as businesses and the city itself cope with the aftermath. In January, the Atlantic Club Casino Hotel, with about 800 rooms, closed.
Other places have been hit, too.

As other parts of the nation experience a slow economic rebound, Atlantic City is going in the other direction. Annual property-tax revenue from the three casinos that are closing totaled more than $30 million, or about 15% of the city's budget, city officials said.Some casinos in Pennsylvania, Delaware, Connecticut and Maryland are seeing their fortunes decline, along with some near Lake Tahoe in Nevada. But few wagered as much as Atlantic City, where casino property-tax revenue makes up about 65% of the city's budget. The city of 40,000 is now a prime example of the danger of putting too many economic development eggs in the same basket, and failing to invest in other avenues of growth.
Mayor Don Guardian said Atlantic City would have to cut hundreds of employees and slash the city budget to make up for the losses. The city also is proposing a 29% property tax increase for homeowners. The jobless rate, at 13% and likely to rise, already is more than twice the U.S. rate of 6.2%.
"This is worse than Sandy," said Eric McCoy, a local minister who leads a regional church association. "The storm eventually went away. This is going to continue."
When the Revel opened just two years ago, it was hailed by Republican Gov. Chris Christie and others as a game-changer. Instead, it was hurt by competition from Pennsylvania's casinos and by poor business decisions, including building its own power plant that lost as much as $2 million a month. The casino hotel had an operating loss of $185 million in 2013, and filed for bankruptcy protection from creditors twice before this summer's announcement it would close for good.
Atlantic City boomed through the 1920s Prohibition Era, with fancy restaurants and grandiose hotels, along with Hollywood performers. Trains were often packed with vacationers headed to the swanky resort. Its heyday is captured in HBO's "Boardwalk Empire," featuring the ups and downs of Mayor Nucky Thompson. Its streets inspired the modern "Monopoly" board.
After World War II, the city's fortunes declined. Paul Steelman, a casino architect who grew up here, said he would run red lights late at night because he was afraid he would get carjacked. The 1964 Democratic convention here wound up focusing national attention on a city in disrepair.
By the 1980s, casinos had turned Atlantic City into one of the most visited destinations in the nation, as tourists came not just to gamble, but to watch heavyweight bouts featuring Mike Tyson and rousing concerts at Boardwalk Hall. New revenue from the boom brought improvements—new schools, a shopping center, new roads and playgrounds.
But the resort once known for a horse that dived from a pier into the Atlantic Ocean became a one-trick pony. Even as gambling revenues reached a peak of $5.2 billion in 2006, the city didn't market its beaches, which are often eerily empty. It now spends $30 million a year on marketing, far less than Las Vegas, with a budget ofabout $120 million. It had no tourism alliance until 2011.
Las Vegas also faced increased competition in the late 1980s, and "was worried about Atlantic City" as a competitor, said David Schwartz, director of the Center for Gaming Research at University of Nevada, Las Vegas. Las Vegas officials focused on creating a different kind of economy, with pirate shows for children, luxury retail shops, amusement rides, performers like Celine Dion and shows like Cirque de Soleil. Billions of dollars in investment poured in with the Mirage, the Bellagio, the Venetian and Mandalay Bay, among other properties.
Some Atlantic City casinos have bucked the down trend.
Resorts Casino Hotel, the first to open in 1978, remade itself with new restaurants and a full-scale makeover. The Borgata, a property with penthouse spas, tropical indoor pools and high-end restaurants, remains more than 95% occupied on most nights. Analysts say the closures could help the remaining eight casinos survive as customers try their gaming floors.
Mr. Guardian, the mayor, said Atlantic City has made significant improvements in cleaning up residential blight. Mr. Christie has a five-year plan for Atlantic City that includes another convention center, more flights into the small airport and more efforts to promote offerings such as beach concerts, aerospace shows and wine tastings. Officials talk eagerly about the Bass Pro Shops hunting and outdoors-goods store that is expected to open next year.
Some wonder if a smattering of new restaurants and shops, along with a new convention center, will overcome the huge loss of gambling revenue. "There are a lot of convention centers sitting vacant in a lot of cities," said Mr. Steelman.
So far, Christie administration officials have declined to say if they have new ideas for Atlantic City beyond ones discussed in their previous plans. The governor has called for a special meeting of state and local officials on Sept. 8 to discuss the city's future.
"We think Atlantic City can be a vibrant, healthy city," said Lou Goetting, Mr. Christie's deputy chief of staff. "There is certainly room for growth and expansion."
A man gambles at Atlantic City's Showboat Casino, which is closing on July 29, 2014. Two other casinos are set to close in the next few weeks. Getty Images
Write to Josh Dawsey at joshua.dawsey@wsj.com