Lottery is a game in which players pay a nominal price, choose groups of numbers or have machines select them for them, and win cash prizes based on the proportion of tickets bearing matching numbers. Its roots are ancient: Moses was instructed to divide land by lottery, and the Roman emperors gave away property and slaves this way. Modern applications include military conscription, commercial promotions in which property is given away by a random procedure, and the selection of jury members from lists of registered voters.

In the United States, state-run lotteries are a major source of public funds. Since New Hampshire established the first modern state lottery in 1964, most other states have followed suit. While critics cite the social costs of the games, supporters argue that they represent a painless form of taxation.

During the first years of operation, lottery revenues often increase rapidly and then level off or decline. To maintain or increase revenue, lottery operators introduce a range of innovations, including scratch-off tickets and other instant games. These innovations have sparked controversies about their effects on compulsive gamblers, the potential for lotteries to disproportionately affect lower-income people, and other issues.

In most cases, the state legislates a lottery monopoly for itself; establishes an independent agency or public corporation to run it (as opposed to licensing a private company in return for a share of profits); begins operations with a modest number of relatively simple games; and then expands its offerings by adding new games. Lotteries are a popular source of income for many people, although they also divert billions of dollars from individuals who could otherwise be saving for retirement or college tuition.