A lottery is a game in which a number of tickets are sold and drawn for prizes. It is a form of gambling that is legal in most countries and can be conducted by government agencies or private organizations. Lottery games have a long history and are popular around the world. Some are organized for charitable purposes and others are for personal gain. In the US, state-run lotteries are a popular source of revenue and have helped build universities and other public facilities. However, many people have questions about whether it is ethical for a state to promote gambling and encourage the poor or problem gamblers to spend their money.

The use of lotteries to make decisions and determine fates has a long history, going back at least as far as the Chinese Han dynasty (205–187 BC). In modern times, however, most public lotteries are designed as gambling machines that pay out cash prizes. The first lotteries were little more than traditional raffles in which the public bought tickets that would be drawn at some future date, weeks or months away. Since the 1970s, innovations in gaming technology have radically changed the industry. Instant games, like scratch-off tickets, have increased lottery popularity and revenues by allowing the public to win small sums immediately. Other innovations, like games where players pick numbers from a computerized grid, have increased the frequency and the size of prizes.

Lotteries have a broad appeal to the general public, and most states have reported that more than 60% of adults play at some time or another. They also attract a variety of specific constituencies, including convenience store owners who sell tickets; lottery suppliers (whose executives often make significant contributions to state political campaigns); teachers in states where lottery revenues are earmarked for education; and legislators who are accustomed to seeing extra revenue arrive each year.

In the US, state-sponsored lotteries have grown dramatically since 1964, and have become an important source of revenue. The amount of money that can be won varies from state to state. Some offer a single large prize while others have multiple smaller prizes. Many states require that a certain percentage of the proceeds be dedicated to a particular public purpose, such as education.

The first European lotteries to award prize money in the form of currency were held in the Low Countries in the 15th century. Towns raised funds to build fortifications and aid the poor, as documented in records from Bruges, Ghent, and Utrecht. Francis I of France arranged public lotteries after his visit to Italy.

In many states, most of the ticket sales go into a prize pool, with profits for the promoter and costs of promotion deducted from the total. The remaining funds are allocated to a wide range of projects by state legislatures. In 2023, lottery revenues accounted for about 2 percent of each state’s total revenue. Although this is a substantial sum, it is hardly enough to offset a tax reduction or meaningfully bolster state expenditures.