Lottery is a game of chance in which prizes, such as money or goods, are allocated by a process that relies on chance. It can also refer to a system of allocation by drawing lots in other ways, as in the case of the draw of names for rooms at schools or other institutions. The word is derived from the Latin lotto, meaning ‘fate,’ and the Middle Dutch word Loterie, which in turn are calqued from Middle High German lotterie, Middle French lottery, and (perhaps) Middle English lot.

Until recently, state lotteries were an important source of revenue for states, particularly during the immediate post-World War II period as they sought to expand their array of services without increasing relatively onerous taxes on middle and working class taxpayers. In the early years, this was seen as a good thing: buying a ticket for two dollars, with one dollar going to the state and the other into the prize pool, is supposed to make people feel like they are doing their civic duty to help the government, even if they do not win.

But once a lottery is established, debate and criticism usually shifts from its general desirability to more specific features of its operations: for example, its effects on compulsive gamblers, or its regressive impact on lower-income groups. And it is a rare state that has a coherent public policy for its gambling industry.