A lottery is any contest in which prizes are allocated by drawing lots. It may be state-run and promise a big cash prize to the winners, or it can refer to any arrangement where there is great demand for something that is limited, such as units in a subsidized housing block or kindergarten placements at a reputable public school. People also use the word to describe things whose outcome depends on chance, such as finding true love or being hit by lightning.

State governments set laws regulating lotteries, and these are usually delegated to a special lottery board or commission to administer. Retailers are the distribution channels for tickets, and states typically pay them a commission on each ticket sold. Many states also have incentive-based programs for retailers who meet sales criteria.

In the United States, most state governments and the District of Columbia operate lotteries. Unlike private games, the profits from state lotteries are used solely for government programs. The word “lottery” is derived from the ancient practice of drawing lots to determine ownership or rights. The term was first recorded in the Low Countries in the 15th century, when it was used to raise money for town fortifications and charity.

Today, most state governments conduct a variety of lotteries, from scratch-off games to the traditional drawing of numbers to select winners. The most popular games involve picking a series of numbers from one to fifty (or sometimes more). In the past, some of these games were passive drawing games in which players purchased a ticket preprinted with a number, and then had to wait weeks for the results. These types of games grew less popular as consumers demanded more exciting games with quicker payouts. Some groups of people pool their money and buy tickets, with the goal of winning a large jackpot. Although this can increase the odds of winning, it also increases the chances of a group losing the money they have invested.