Colin Barnett has defended a 60 per cent rise in the number of gambling tables and 35 per cent increase in gambling machines at the Burswood Entertainment Complex.
Critics have said the increases could worsen problem gambling.
As part of the deal that underpins the $568 million Crown Towers hotel investment, the State Government will back Burswood's push to massively increase its casino operations over the next five years.
The plan, which must first be approved by the Gaming and Wagering Commission, would increase the number of tables from 220 to 350 over five years.
Gambling machines would increase from 1850 to 2500, though Burswood's existing gaming licence entitles it to 2000 machines.
The expansion is expected to net WA taxpayers an additional $52 million a year in casino tax.
The Government expects to collect $117 million in casino tax in 2012-13.
The Premier described the increase in gambling operations as "natural growth" in line with the casino's huge increase in visitor numbers and Perth's population growth.
"Common sense prevails, I think - if you're going to build a new, major hotel of six-star standard in a casino complex, you need to expand the casino part," he said.
Burswood chief Barry Felstead said that since 2007 patronage had grown from 4 million visitors annually to 7 million, with plans to achieve as many as 10 million a year by 2017.
"It's obviously critical in terms of we need to pay for the hotel," Mr Felstead said when asked how important the gambling expansion was to the hotel project.
Financial Counselling Association executive officer Charlie Brown was appalled by the scale of the expansion, which he described as a "threat to vulnerable people".
"It disadvantages everyone else in the community for the benefit of a very few people," Mr Brown said.
Rod West, executive manager of Centrecare, said the not-for-profit group was always keen the chances to gamble be minimised but unchecked online gambling was a bigger problem than the casino.
"Five hundred machines and 130 tables is a lot," he said. "But we would prefer it is confined to that venue rather than finding it in our pubs and clubs."
Anglicare chief Ian Carter said he was pleased there was no push to expand machine gambling beyond the casino or to introduce poker machines.