Lottery is a form of gambling where a group of people pays money to enter a drawing for a prize. This can be in a variety of forms, from sports events to the distribution of public services such as housing units or kindergarten placements. Financial lotteries are the most common type, where participants bet small sums of money for the chance to win a large amount of money. Although the casting of lots for important decisions has a long record (including several instances in the Bible), betting on the outcome of a lottery is relatively recent, and only since the mid-20th century have states increasingly adopted them as an important source of state revenue.
When a lottery is adopted, it generally establishes a government-controlled monopoly; hires a public corporation or state agency to run it; begins operations with a modest number of relatively simple games; and then tries to keep up with demand by continually expanding the game offering. Critics argue that the constant push to increase revenues often distorts lottery operations by presenting misleading information about odds of winning the top prize, inflating jackpot amounts in order to attract media attention, and so on.
Another problem is that the success of a lottery often depends on its being seen as serving a specific public good, such as education. This can be especially effective during times of economic stress, when the lottery is offered as an alternative to higher taxes or cuts in state programs. Nevertheless, studies have shown that the fiscal circumstances of state governments rarely appear to have much influence on whether or when they adopt lotteries.