A lottery is a game in which numbered tickets are sold for a chance to win a prize, such as money or goods. It is usually run by a state government. It may be played by individuals or groups. The term may also refer to a system of distribution for other events or decisions, such as sports team drafts or the allocation of scarce medical treatment.

The concept of lottery is at least as old as the written word. Early lotteries were used in Europe to raise money for public ventures, including roads and town fortifications. In colonial America, lotteries played a significant role in financing private and public projects, including schools, churches, canals, colleges and universities. In addition, lotteries helped finance the Revolutionary War and the French and Indian Wars.

Many people play the lottery because they enjoy fantasizing about winning a fortune. The lure of a huge jackpot attracts millions of ticket-holders each week. But for most people, the odds of winning are very low. Moreover, research has shown that lottery games drain the budgets of those with limited incomes. Indeed, those with the lowest incomes account for a disproportionate share of players. Consequently, critics claim that the lottery is a hidden tax on those who can least afford it.

Lottery laws vary from state to state, but most states have special lottery divisions that manage and regulate the games. These departments select and license retailers, train employees of retail outlets in the use of lottery terminals, sell and redeem tickets, pay high-tier prizes to players, and ensure that retailers and players comply with state law and rules. Retailers are compensated for selling lottery tickets by keeping a percentage of the gross receipts. They may be paid a flat commission for each ticket or may receive an incentive for increasing sales by specific amounts.

In the United States, almost 186,000 retailers sell lottery tickets. Many of these are convenience stores, gas stations and restaurants. Others include nonprofit organizations (such as churches and fraternal organizations), service stations, bowling alleys, and newsstands. In 2003, nine states reported a decline in lottery sales compared to the previous year.

There are many arguments against the lottery, but some of the most common ones focus on the lack of public accountability. Most states have a legislative body that oversees the operation of the lottery, but there are few independent audits of state lottery operations. In addition, the lottery is not required to disclose information about its profits and expenditures, which makes it difficult to evaluate whether or not it is meeting its goals. Despite these arguments, the lottery continues to grow in popularity. In the last several years, it has been a major source of revenue for states and has attracted many new customers. The growing interest in the lottery is due to increased advertising and publicity. It is also a result of the increased demand for consumer services and the emergence of the Internet.