A lottery is a method of raising funds by selling tickets for a prize, the distribution of which is determined by chance. State governments regulate the operation of lotteries, and some delegate responsibility to a separate lottery board or commission. These lottery divisions select and license retailers, train employees to operate terminals and sell tickets, assist them in promoting the lottery games, pay winning tickets, and ensure that players and retailers comply with state law.

The first recorded lotteries to offer tickets for sale and prizes in money took place in the Low Countries of Belgium, Holland, and Germany during the 15th century, although a record from Ghent dating back to 1445 suggests that private lotteries had existed earlier. The idea of drawing numbers and staking them on the outcome of a random process has proven extremely popular.

Almost every state that has adopted a lottery has done so based on the idea that the proceeds will support some kind of public good. The principal argument is that lotteries represent a “painless” way for states to raise money, as they do not involve tax increases or cuts in programs. Studies have shown, however, that the objective fiscal condition of a state does not appear to have any effect on whether or when a lottery is adopted.

Once state lotteries are established, they often become the focus of criticism ranging from complaints about compulsive gambling to accusations that they are regressive in their impact on lower-income groups. The lottery has also been the source of many ethical and policy concerns.