A lottery is a procedure for distributing money or prizes among a group of people by chance, according to the law of large numbers. Lottery games are often regulated by governments to ensure fairness. They are popular as a method of collecting taxes or for funding public projects, such as the British Museum, bridge repairs, and several American colleges, including Harvard, Dartmouth, Yale, and King’s College (now Columbia).

The first recorded lotteries with tickets sold for cash dates to the 15th century in the Low Countries, when towns held lotteries to raise funds for town fortifications and help the poor. They were similar to the distribution of gifts at dinner parties.

There are many different types of lotteries, including scratch-offs and pull-tab tickets. The latter are usually printed on both sides with the winning combination displayed on the front and the numbering on the back, which is hidden behind a perforated paper tab that must be pulled to reveal it.

A key element of any lottery is a system for collecting and pooling the money placed as stakes. This is normally accomplished by a hierarchy of sales agents who pass the money up through the organization until it is “banked.” A second key requirement is a set of rules determining the frequencies and sizes of prizes. Usually, the costs of organizing and promoting the lottery as well as taxes or other revenues must be deducted from the prize pool; this leaves only a small percentage for the winners.