Lottery is any procedure for distributing something (usually money or prizes) among a group of people by chance, as opposed to through a competitive process. The term lottery is used most commonly to refer to state-sponsored games in which a person pays a small amount of money to have a chance to win a larger sum. But it can also be applied to any contest or game of chance in which the winners are determined by lot, as in a sports event or public auction.

Most state-sponsored lotteries have a central organization to administer the lottery and make sure that it is conducted according to the law. This organization may be a government agency or a private corporation, depending on the laws of the jurisdiction in which it operates. Its duties may include selecting and training retailers, administering a system for selling tickets, redeeming winning tickets, distributing prizes, promoting the lotteries, paying high-tier prize amounts, and ensuring that both the lottery operators and retail outlets follow the laws of the state.

In the immediate post-World War II period, many states used lotteries to fund a growing array of social safety net services without increasing taxes on middle and working class families too much. The resulting popular belief that lotteries are a kind of hidden tax on the common people has been a nagging problem for supporters.

Moreover, the fact that super-sized jackpots drive ticket sales obscures the regressive nature of the game. The top prizes are overwhelmingly won by players who are lower-income, less educated, and nonwhite.