UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15 (d) of the

Securities Exchange Act of 1934

Date of Report – October 25, 2007

(Date of earliest event reported)

PENN NATIONAL GAMING, INC.

 (Exact name of registrant as specified in its charter)

Area Code (610) 373-2400

(Registrant’s telephone number)

Check the appropriate box below if the form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 to Form 8-K):

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02          Results of Operations and Financial Condition.

On October 25, 2007, Penn National Gaming, Inc. (the “Company”) issued a press release announcing its financial results for the three and nine months ended September 30, 2007. The full text of the press release is attached as Exhibit 99.1 and incorporated herein by reference.

The information in Item 2.02 of this Form 8-K and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

Item 9.01      Financial Statements and Exhibits.

(d)      Exhibits.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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EXHIBIT INDEX

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Exhibit 99.1

FOR IMMEDIATE RELEASE

PENN NATIONAL GAMING REPORTS THIRD QUARTER

DILUTED EPS OF $0.52, INCLUSIVE OF $0.02 PER DILUTED SHARE

LOSS FROM CURRENCY TRANSLATION

- Third Quarter EBITDA of $177.6 Million -

- Establishes 2007 Fourth Quarter Guidance -

Wyomissing, Penn., (October 25, 2007) – Penn National Gaming, Inc. (PENN: Nasdaq) today reported third quarter operating results for the period ended September 30, 2007, as summarized below.

Summary of Third Quarter Results

(1)          EBITDA is income from continuing operations, excluding charges for stock compensation, depreciation and amortization, and gain or loss on disposal of assets, and is inclusive of earnings from joint venture. A reconciliation of net income per accounting principles generally accepted in the United States of America (“GAAP”) to EBITDA, as well as income from continuing operations per GAAP to EBITDA is included in the accompanying financial schedules.

(2)          The figures in this column present the guidance Penn National Gaming provided on July 26, 2007 for the quarter ended September 30, 2007.

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Review of Third Quarter 2007 Results vs. Guidance and Third Quarter 2006 Results

(1)          The figures in this column present the guidance Penn National Gaming provided on July 26, 2007 for the quarter ended September 30, 2007.

In the three months ended September 30, 2007, the Company recorded a non-cash pre-tax currency translation loss of $2.5 million ($1.6 million, net of taxes, or $0.02 per diluted share) related to Canadian currency fluctuations for FIN 48 estimated tax reserves.

Commenting on the results, Peter M. Carlino, Chairman and Chief Executive Officer of Penn National Gaming said, “Penn National’s diversified portfolio of gaming properties generated record third quarter results, including a 7.4% net revenue increase and a 9.1% rise in EBITDA. This performance reflects year-over-year growth at eleven of the sixteen casino and racing properties that we own or operate and the first full quarter’s contribution from the Zia Park facility that was acquired in the second quarter. Third quarter EBITDA was marginally below our guidance as overall revenue growth was impacted by continued competitive pressures at our Joliet facility, a shortfall at our Biloxi property related to new competition, and ongoing post-hurricane market stabilization.

“We recently named a new general manager at Empress Joliet Casino and Hotel who brings 25 years of successful gaming industry experience to this role. This appointment highlights our commitment to the Empress property and our Illinois assets, as well as our long-term emphasis on attracting and developing premier management teams at all of our properties. We expect that the new general manager will contribute to improved financial performance at Joliet.

“During the third quarter, our Charles Town property extended its long-term track record of delivering impressive year over year growth, with EBITDA rising about 7% from last year’s levels on a 5% revenue increase. With the opening in the second quarter of our latest expansion at Charles Town, we increased the total slot count at the property to approximately 5,000 units. The expansion contributed to another solid quarterly sequential improvement in revenue and EBITDA at the property. Although the ramp up in slot revenue was slower than previous expansions and below our expectations, we remain confident in the market, and expect that, over time, the expansion will deliver economic returns consistent with our projections. Our next phase of development at Charles Town includes a 153-room hotel that will open in just under a year.

“With our legacy of success in the racing industry, including the ongoing significant investment and expansion of Bangor Historic Track and the recent integration of Zia Park, we continue to pursue

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opportunities to leverage our pari-mutuel management and property development skills. Accordingly, last week Penn National completed its acquisition of the Sanford-Orlando Kennel Club, which offers year-round greyhound racing and includes 26 acres of land in Orlando, Florida. While Sanford is a modest pari-mutuel operation, we believe it may have future opportunities for expanded gaming. Along with the purchase, we also secured a right of first refusal to acquire the Sarasota Kennel Club which runs year-round greyhound meets and operates a poker room. The economics of the transaction are attractive given the potential upside of the opportunity.

“Similarly, during the third quarter, we reached a definitive agreement to acquire Rosecroft Raceway in Fort Washington, Maryland. This transaction, expected to close later this quarter, allows us to further diversify what is now the nation’s second largest portfolio of horse racing assets, and offers Penn National a favorable investment from several standpoints, including its desirable real estate, which amounts to approximately 130 acres of land in Prince George’s County on the outskirts of Washington, DC. Last week, Maryland’s Governor formally called for a special session of the Legislature to address the state’s projected $1.7 billion budget deficit. This special session is scheduled to begin next week and the Governor has asked the Legislature to review alternatives for addressing the deficit, including the possible addition of 9,500 slots at a limited number of locations in the State.

“During the quarter, we advanced several of our strategies for long-term growth both from existing facilities and through new development. In August, Penn National filed its license application with the Kansas Lottery Commission to be considered as a Lottery Gaming Facility Manager at a destination casino resort in Cherokee County, which is budgeted at almost $300 million. Cherokee County is within the Southeast Gaming Zone, one of four areas of the state where casino gaming is authorized under the new Kansas Expanded Lottery Act. Penn National Gaming earned an exclusive endorsement from the Cherokee County Commissioners and executed a pre-development agreement with our host community. We believe that our long-term track-record of developing a broad range of successful regional casino entertainment facilities which create jobs, tax revenues and other sustainable economic benefits, will be important considerations as this process advances at the Lottery Commission.

“We are on schedule to complete three significant projects in 2008, including the Hollywood Casino at Penn National Race Course, the permanent Hollywood Slots at Bangor facility, which will be called the Hollywood Slots Hotel and Raceway, and significant additional parking capacity at Lawrenceburg.

“We are delighted with the progress to date at Hollywood Casino at Penn National Race Course, including the completion of the 700,000 square-foot, five story garage. We are confident that our design elements, decor and multimedia approach to emphasizing the Hollywood theme will drive patrons to this state-of-the-art integrated racing and gaming facility. We continue to expect excellent economic returns based on market demographics and the early results from other facilities with slots in Pennsylvania. Ample parking combined with plans to open with 2,000 slots, extensive

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dining, sports bars, simulcast theaters, spectator boxes and other amenities support our expectation that Hollywood Casino at Penn National Race Course is destined to emerge as a strong regional entertainment center in central Pennsylvania. Looking forward, our plan for the site includes expanding the slot base to 3,000 positions, a 2,000 seat showroom for entertainment and music acts, more parking and, once demand warrants, retail space and a hotel.

“We are achieving similar high levels of progress on the construction of the permanent Hollywood Slots Hotel and Raceway in Bangor. Consistent with our master plan and agreement with the state, we are in the process of re-configuring local traffic ramps to improve ingress and egress to the site. Construction crews are also in the process of completing exterior work on the building so they can turn their focus to interior construction and finishes. We anticipate the 116,000 square foot Bangor casino and 152-room, six story hotel, four-story parking garage, restaurants and retail space as well as a new simulcast facility for off-track wagering will open mid-2008 with 500 employees, 1,000 slots, and capacity for a total of 1,500 gaming machines.

“As previously disclosed, in June, the Company entered into a definitive agreement to be acquired by certain funds managed by affiliates of Fortress Investment Group LLC and Centerbridge Partners LP, whereby Penn National Gaming shareholders will receive $67.00 in cash for each outstanding Penn National share. In connection with the proposed merger, Penn National Gaming filed a preliminary proxy statement with the Securities and Exchange Commission that included additional information on the transaction, and we expect to soon establish a date for the special meeting of shareholders to consider and vote upon the proposal to approve and adopt the Agreement and Plan of Merger.”

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Development and Expansion Projects

The table below outlines Penn National Gaming’s current pipeline of new or expanded facilities:

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Financial Guidance

The following table sets forth current guidance targets for financial results from continuing operations for the 2007 fourth quarter and full year, based on the following assumptions:

•                  The Company will face increased competition related to new facility openings in the St. Louis market in the fourth quarter of 2007;

•                  Pre-opening costs at Hollywood Casino at Penn National Race Course of $3.6 million pre-tax ($2.0 million, net of taxes, or $0.02 per diluted share) will be incurred in the fourth quarter and $5.2 million pre-tax ($2.9 million, net of taxes, or $0.03 per diluted share) will be incurred for full year 2007;

•                  There will be a reduction in property insurance and related costs, with an annualized benefit of $8.2 million pre-tax ($4.5 million, net of taxes, or $0.05 per diluted share) which began in August 2007;

•                  The 3% tax surcharge continues to be expensed and paid into escrow at Hollywood Casino Aurora and Empress Casino Joliet;

•                  The Illinois “hold harmless” tax minimum guarantee expired effective July 1, 2007;

•                  Penn National Gaming is currently required by the Illinois Gaming Board to reach a definitive sales agreement for the Empress Casino Hotel by June 30, 2008. However, the results of Empress Casino Hotel remain included in continuing operations as the Company assumes that the accounting standards for treating properties as “assets held for sale” will not be met in 2007; as such, the results from the property are included in our 2007 fourth quarter and full year guidance;

•                  Depreciation and amortization are projected to increase in the fourth quarter by $1.8 million and the full year 2007 by $23.3 million over the comparable prior year periods;

•                  Full year 2007 results will reflect a pre-tax non-cash charge for stock compensation of $25.4 million ($18.5 million, net of taxes, or $0.21 per diluted share);

•                  The effective tax rate for federal, state and local income taxes for the fourth quarter and full year 2007 will be 45.0%, reflecting the impact of better operating results in jurisdictions with higher state income tax, material amounts of non-deductible lobbying expenses, non-deductible merger-related costs and FIN 48 costs;

•                  The Company will have approximately 88.2 million diluted shares outstanding as of December 31, 2007;  and,

•                  There will be no material changes in economic conditions, applicable legislation or regulation, world events, weather, or other circumstances beyond our control that may adversely affect the Company’s results of operations.

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(1)          EBITDA is income from continuing operations excluding charges for stock compensation, depreciation and amortization, gain or loss on disposal of assets, hurricane and goodwill impairment, and is inclusive of earnings from joint venture.

2006 EBITDA to 2007 EBITDA Guidance Reconciliation

(1)          EBITDA is income from continuing operations excluding charges for stock compensation, depreciation and amortization, gain or loss on disposal of assets, hurricane and goodwill impairment, and is inclusive of earnings from joint venture.

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PENN NATIONAL GAMING, INC. AND SUBSIDIARIES

Property Information – Continuing Operations

(in thousands) (unaudited)

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(1)   EBITDA is income from continuing operations excluding charges for stock compensation, depreciation and amortization, and gain or loss on disposal of assets, and is inclusive of earnings from joint venture. A reconciliation of net income per accounting principles generally accepted in the United States of America (“GAAP”) to EBITDA, as well as income from continuing operations per GAAP to EBITDA is included in the accompanying financial schedules.

(2)   Hollywood Casino Bay St. Louis and Boomtown Biloxi were closed effective August 28, 2005 due to hurricane damage. Boomtown Biloxi reopened on June 29, 2006 and Hollywood Casino Bay St. Louis reopened on August 31, 2006.

(3)   Reflects results since the April 16, 2007 acquisition effective date.

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Reconciliation of EBITDA to Net Income (GAAP)

PENN NATIONAL GAMING, INC. AND SUBSIDIARIES

(in thousands) (unaudited)

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Reconciliation of Income from Continuing Operations (GAAP) to EBITDA

PENN NATIONAL GAMING, INC. AND SUBSIDIARIES

Property Information Including Corporate Overhead

(in thousands) (unaudited)

Three Months Ended September 30, 2007

Three Months Ended September 30, 2006

(1)   Income from continuing operations and EBITDA for the three months ended September 30 2006 reflects the closure of Hollywood Casino Bay St. Louis and Boomtown Biloxi, which incurred extensive hurricane damage in August 2005. Boomtown Biloxi reopened on June 29, 2006 and Hollywood Casino Bay St. Louis reopened on August 31, 2006.

(2)   Reflects results since the April 16, 2007 acquisition effective date.

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Reconciliation of Income from Continuing Operations (GAAP) to EBITDA

PENN NATIONAL GAMING, INC. AND SUBSIDIARIES

Property Information Including Corporate Overhead

(in thousands) (unaudited)

Nine Months Ended September 30, 2007

Nine Months Ended September 30, 2006