Lotteries are arrangements by which a prize or set of prizes is allocated to people in a class, in a way that relies wholly on chance. While making decisions and determining fates by casting lots has an ancient record (including several instances in the Bible), the use of lotteries for material gain is far more recent.

Lottery arrangements differ widely in terms of the number and type of prizes, the method by which tickets are purchased and sold, and how the prize winners are chosen. Nevertheless, all lottery arrangements have some common features. For example, all have some means of collecting and pooling all the money paid as stakes, and all have a mechanism for drawing winning tickets or symbols. Moreover, all have some kind of randomizing procedure to ensure that chance determines the winner. This may include thoroughly mixing the tickets or symbols before the drawing, and/or using some mechanical device to select winners. Many lotteries employ computerized drawing machines for this purpose.

Most state lotteries are arranged to be run by government agencies, public corporations, or a combination of both. These arrangements are generally designed to maximize the amount of revenue generated for the state, and they often use a variety of marketing techniques. Moreover, they generally start with a small number of games and then expand their offerings over time. The resulting competition can be intense.

Despite their popularity, lottery arrangements have been the subject of substantial criticism and debate. Typical criticisms revolve around the problems of compulsive gambling and the alleged regressive impact on lower-income families. These concerns are not inherently contradictory, but they are usually not addressed by lottery officials, who rely on the argument that lotteries are good for the states and for society as a whole.

Some critics also argue that lottery games encourage gambling addiction and social inequality by providing an easy outlet for frustrated desires and poor decision-making. However, other researchers have pointed out that the majority of lottery participants are middle-class and do not belong to either high- or low-income neighborhoods. Furthermore, they have a strong tendency to play scratch-offs and other games that do not involve large investments.

Finally, a major flaw in the argument for state lotteries is that they rely on the message that they are a painless form of taxation. While this argument may have been valid in the immediate post-World War II period, it is no longer true today. In the end, lottery revenues are just a drop in the bucket compared to overall state taxation.