Illinois became the first state to admonish Airbnb Inc. for delisting Jewish-owned lodgings on the West Bank, determining the home-sharing company had violated a law barring state investments in companies that boycott Israel.

Additional states will likely follow Illinois’ lead, potentially complicating Airbnb’s expected public offering of its shares, said Eugene Kontorovich, a professor of international law at the George Mason University’s law school.

The Illinois Investment Policy Board (IIPB) Dec. 12 unanimously affirmed a statement finding Airbnb’s ban on lodging listings in the disputed West Bank doesn’t comply with the state’s law against aiding the Boycott, Divestment or Sanction...