Lottery is a game in which participants pay for tickets and hope to win a prize. The prize money is often awarded by drawing lots, though other methods may be used. In modern lottery games, prizes are usually cash or merchandise. The word “lottery” is probably derived from Middle Dutch Loterij, or perhaps via Old French loterie, from Loteria, Latin for drawing lots (see Lottery). Earlier, the term could refer to a grouping of persons for military conscription, commercial promotions in which property was given away by a random procedure, and the selection of jury members from lists of registered voters. In the strictest sense, lottery is considered a form of gambling, and the only way to qualify as a legitimate lottery is if the payment of a consideration (property, work, or money) is required for a chance to receive the prize.

Lotteries were first popularized in Europe during the 15th century by Burgundy and Flanders towns in their attempt to raise funds for the town’s defenses and poor relief, although there is evidence that they were in use even earlier. They were introduced to the United States by British colonists, and at the outset of the Revolutionary War the Continental Congress voted to establish a lottery as a means of raising money for the American army.

Many people play the lottery as a form of low-risk investment; they spend a small amount of money in return for a chance to get hundreds of millions of dollars. This type of lottery is highly regressive, with a substantial share of ticket purchases coming from the bottom quintiles of income distribution. In addition, lottery playing can prevent people from saving money for retirement or education and it is a major source of waste in the economy.