A competition based on chance, in which numbered tickets are sold and prizes are awarded to the holders of numbers drawn at random. Often used as a means of raising money for public projects.

Although the casting of lots to decide issues and determine fates has a long record, it was not until the 1850s that states began using lotteries as a revenue source to finance a broad range of public activities without significantly increasing taxes on middle-class and working-class citizens. Lotteries grew particularly fast in the Northeast, where social safety nets were large and officials viewed them as a means to expand state services while avoiding the cost of heavy tax increases.

In most cases, a lottery is run by a government or nonprofit organization that offers several types of games and awards prizes to the winners. The winnings can be either a lump sum or an annuity payment. The amount of the payments depends on state laws and the rules of the specific lottery.

The first lotteries in Europe were organized in the 15th century to raise funds for a variety of uses, including municipal repairs and charity. The earliest recorded lotteries with prizes in the form of money were held in 1466, in the Low Countries (including Ghent, Utrecht, and Bruges).