I don't think its illegal to not pay for an internship, that's what an internship basically is - a fancy word for unpaid volunteer work so that you can get a foot in the door and possibly get hired by that company if they have an opening. Internships are meant to beef up your resume. If they paid you for an internship, then it wouldn't be called an internship, it would be called a hired position aka employee. The only internships I know of that actually pay, are medical student doctor's internships, and that's because they're on those internships for well over a year at the same hospital and its through their med school universities.
But I've never heard of any other field giving a paid internship. In this tough economy, that's just not realistic. You should be looking for a real hired position, not internships.