Lottery is a game of chance in which winners are selected by a random drawing. The prize amounts vary. It is a popular form of gambling that encourages people to pay a small amount for the chance of winning a large prize, often administered by state or federal governments. It can also refer to a decision-making process in which winners are chosen by random selection: for example, sports team drafts or the allocation of scarce medical treatment.

Lotteries have become a popular source of revenue for states, and some even fund entire public projects, including highways, bridges, canals, schools, and churches. In addition, they contribute billions to the economy every year. They are not without criticism, however. Many critics believe that they prey on the economically disadvantaged by convincing them to waste money on tickets. Others argue that lottery games are a sham that encourage people to buy false hope and that the odds of winning are much lower than advertised.

The word lottery is derived from the Latin root Lottera, which means “fate,” or “to have a destiny.” The first recorded lotteries date back to ancient China, where keno slips were used in 205–187 BC. Those early lotteries were not very complex and were simply drawn by hand, but later, more sophisticated games were developed, such as those in which a person chooses numbers and waits for the outcome of a random drawing. The latter are called passive drawing games, and they were the dominant type of lottery in 1973.

In the late 1960s, Connecticut, Illinois, Massachusetts, Michigan, and New York established state lotteries that allow players to select a set of numbers for a chance to win prizes. The games can range from a few hundred dollars to millions of dollars. Most state lotteries also offer a wide range of other types of games, including scratch-off tickets and video game prizes.

Many people enjoy playing the lottery, and it is estimated that about half of all adults play at least once a month. In the United States, more than 200 state lotteries are legal and raise over $60 billion per year in ticket sales.

Most of that money goes toward the prize pot, with a smaller portion going to administrative costs and vendor payments. The remainder is allocated to projects designated by each state. The North American Association of State and Provincial Lotteries publishes the amounts that each state spends on these projects.

In recent years, the popularity of state lotteries has grown. In addition to traditional prizes, some states now offer a variety of alternative jackpots, such as instant games and sports pools, that can be played with a smartphone or computer. These alternatives can be more interesting than a simple draw of numbers. They may also help increase revenue for a specific project, which can be important when government budgets are tight. In addition, they can make the experience more fun for some participants who would not otherwise be interested in participating in a traditional lottery.