Purpose: This study investigates the impacts of ethical goals on local government adoption of artificial intelligence (AI) policy in the United States. Although several studies have been conducted on the ethical adoption of AI, the investigation of the effects of ethical considerations on local government adoption of AI policy has received little attention in public administration and AI adoption research. Our study fills this research gap by examining local government AI policy adoption from the perspective of the adopters’ ethical goals. Method: A survey was sent to 1200 IT professionals in municipal governments across the United States. The survey questionnaire asked about AI policy adoption and the importance of the following on AI policy adoption decisions: enhanced transparency, improved accountability, ethical AI deployment, reduced bias in AI applications, and improved public trust. The data was analyzed using logistic regression. Findings: Although municipalities’ AI adoption is driven by improved accountability, ethical AI deployment, bias reduction, and improved public trust, inadequate funding and complexities of regulatory compliance remain barriers. Contribution: The findings have practical implications for local governments seeking to adopt AI policies. By prioritizing ethical considerations and addressing funding and regulatory challenges, local governments can enhance public trust, gain regulatory approval, and ensure the sustainable integration of AI systems into governmental frameworks.