Could Miss USA Lose Her Crown?

Could resident rules force Miss USA to give up her crown? INSIDE EDITION reports on the controversy surrounding Nia Sanchez over which state was her true residence.

She stole America's heart as the newly crowned Miss USA, but could she now lose her crown? Nia Sanchez competed as Miss Nevada and won the pageant, but could she really be a resident of California?

Sanchez competed three times in the Miss California contest, and lost all three times. Then, she decided to move to Nevada where, some say, it was less competitive.

Whether she is a resident of California or Nevada, Sanchez's new home is New York City, where INSIDE EDITION caught up with her on a sightseeing tour.

INSIDE EDITION's Megan Alexander asked Sanchez why she chose to compete in Nevada.

"I was working a lot in Nevada and I was like well I still love pageants and I need to compete somewhere, and if I'm living here I should compete here," explained Sanchez.

Hear From Miss USA Herself

Sanchez also said the competition in Nevada is just as challenging as it is in California.

"Nevada was such a tough competition this year," said Sanchez. "We had 50 girls and they were all ready for the crown. So it was a good competition."

Sanchez seemed unphased by the controversy, but it may not have helped her case when she failed a pop quiz on a Monday morning radio show. Pageant officials say Sanchez met all the residency requirements, and she will be a great Miss USA.

INSIDE EDITION was also with Sanchez when she settled into her bachelorette pad. She gave us a grand tour of her new place.

The 24-year-old beauty is also a fourth degree black belt in tae kwon do, so she knows a thing or two about fighting back. And now she's certainly fighting the claims that she gamed the system to become Miss USA.