A lottery is a system in which a prize (normally money) is awarded to individuals or groups based on chance. Lotteries are common in many countries, and they are used for a wide variety of purposes. Some examples of a lottery include a school enrollment lottery, housing unit allocations in a public housing complex, or a sports team draft. In some cases, the prizes may be limited to specific categories of people, such as low-income citizens or students attending a particular university.
The first lotteries were arranged to raise funds for town fortifications and to help the poor. The first recorded lotteries to offer tickets for sale with prizes in the form of cash were held in the Low Countries in the 15th century. The lottery is considered by some to be a form of gambling, though it is distinguished from casino gambling in that the chances of winning a lottery prize are substantially greater than those of winning at a casino game.
Those who play the lottery purchase a ticket or a series of tickets for a drawing at some future time, often weeks or months away. Typically, the lottery organization records the identities of bettors, the amount they stake on each ticket or set of tickets, and the numbers or other symbols that they select or have selected for them. After the draw, the lottery organization determines which tickets were successful and awards the prizes.
Historically, lottery prizes have been given in the form of items such as dinnerware, but more recently, the prize has been cash. The size of the prizes varies with the size of the total prize pool. Normally, a portion of the prize pool is used to cover the costs of organizing and promoting the lottery, and a percentage is taken as profits or revenues.