What Is a State Lottery?

A state lottery is an official game of chance that operates as a revenue source. It is governed by state laws, including the operation and accounting of games; distribution of lottery revenue; time limits for claiming prizes; and activities considered illegal (such as selling lottery tickets to minors).

Lottery revenues typically expand dramatically after the game is introduced, then level off or decline. This leads to constant innovation, as new games are introduced to keep players interested.


In addition to traditional drawings for huge jackpots, state lotteries have also adapted to the modern world by offering instant scratch-off games. These games feature lower prize amounts and low odds of winning, and are a popular choice with low-income gamblers.

State Lottery Funds

Some states use their lottery money to support education and social programs. California, for example, has poured more than $12 billion into public schools since 1985 and New York has deposited $1.35 billion into K-12 education funding in the 1999-2000 fiscal year.

Problem Gambling

While a state lottery may seem an appropriate way to raise revenue, some experts question whether the lottery is actually the best solution. For one thing, the lottery’s promotion of gambling can create an addictive effect for many people. Another concern is that the lottery’s business model is designed to maximize revenue, and thus the state’s interest in promoting gambling can conflict with its larger social objectives.

As a result, some state governments have been forced to turn to regulated casinos or other forms of legal gambling for their revenue needs. However, conservative states such as Alabama and Utah prohibit gambling in their constitutions. In addition, religious groups in these states have vehemently opposed gambling.