A lottery is a system for allocating prizes based on chance. A prize may be a cash prize, a gift certificate, or a merchandise item. Lotteries can be state or private. Most states impose laws regulating the operation of lotteries. Some state laws delegate authority to a lottery board or commission to manage the lottery. Some states also regulate the distribution of lottery tickets. In addition, state agencies may oversee merchandising and advertising efforts.

Retailers who sell lottery tickets collect a commission on the sales of each ticket. In some cases, state lotteries offer retailers incentive programs to meet specific sales targets. In addition, many states use computer systems for recording lottery purchases and the allocation of winnings to bettors.

Some people play the lottery regularly despite knowing that they have only a small chance of winning. These people often select the same numbers week after week, citing reasons such as birthdates or address numbers, and the belief that their chances increase the longer they wait for their number to be selected. This mind-set is known as the gambler’s fallacy.

Other people take the lottery seriously, spending large amounts of money to try to win the jackpot. Studies show that those with the lowest incomes make up a disproportionate share of lottery players. This regressivity has fueled criticism that the lottery is a disguised tax on those least able to afford it. While a few winners do become millionaires, most find themselves worse off than before they won.