The Rhode Island House approved a civil unions bill yesterday.
The measure will now go to the Senate, where it is expected to receive broad support.
If passed, it will give gay couples some of the rights of marriage, such as inheritance and hospital visitation rights.
However, some gay rights activists are furious that a gay marriage bill was scrapped in favour of what they see as watered-down legislation.
House Speaker Gordon Fox, who is gay, said gay marriage does not have enough support right now.
Hundreds of people joined a rally to ask lawmakers to support marriage equality last week.
Protesters carried rainbow flags and placards bearing messages such as ‘love has no gender’. One participant, in reference to the House Speaker, held a banner saying ‘fox hunting season is now open’.
Mr Fox says he still wants to see gay marriage legalised but has cautioned that there is not enough support for the move.
Meanwhile, gay news website EDGE reports that a number of sources are claiming that the state’s gay group Marriage Equality Rhode Island (MERI) worked with Democratic officials to prevent the passage of a marriage equality bill this year.
The website quoted five anonymous people who alleged that while MERI officials were publicly advocating gay marriage, they were working behind the scenes to scuttle the legislation in favour of civil unions.
MERI called the claims “pure fantasy” and “nonsense”.