A lottery is a type of gambling where people buy tickets for a chance to win a prize. Lotteries are often run by state or national governments, but they can also be privately organized. The prizes in a lottery are usually money or goods, and the winners are chosen through a drawing. This article describes the basics of lotteries, and can be used as a teaching resource for kids & teens or as a money & personal finance lesson for adults.

The first lotteries were probably held in the Low Countries in the 15th century to raise money for town fortifications and to help the poor. Records of lotteries in Ghent, Utrecht, and Bruges suggest that they were popular in this period.

Almost all states now have lotteries. Whether or not they are profitable, however, is a matter of debate. Some critics have argued that state lotteries are a form of corruption, while others have noted that the proceeds are useful for public purposes such as education.

A key problem with state lotteries is the fragmentation of decision making. Typically, the establishment of a state lottery is done piecemeal, and authority for the operations is divided between the legislative and executive branches. As a result, state lottery officials are subject to frequent changes in policy and have little overall control of the operation. Lottery policy is therefore made incrementally, and the general public welfare is taken into consideration only intermittently.