The only bidder was Empire Resorts which did not pay the required $4.5 million licensing fee.
Empire Resorts predicted that five casinos in the Catskills would draw about 30 million people a year.
The owners of the longtime harness track, Empire Resorts, plan to put the land into federal trust for the tribe.
Empire Resorts and the Mohawks have been partners before.
They opened discussions with Empire Resorts and state officials.
Empire Resorts says the casino in Monticello would attract 6.1 million visitors annually.
If the project goes forward, it will be a victory for Empire Resorts and Robert Berman, a local resident who in 1994 conceived the idea.
And his old company, now known as Empire Resorts, has disowned him.
There is no guarantee that the Cayugas and their partners, Empire Resorts, will be successful in turning that approval into a casino.
Meanwhile, Empire Resorts is bringing a form of gambling to the racetrack next month.