Lottery is a form of gambling in which people purchase chances (usually tickets) to win prizes based on a random drawing. Prizes can range from cash to goods and services. Lotteries are common in many countries, but have been criticized for the potential to create an addictive habit. In the United States, state-run lotteries are a major source of revenue.

The first recorded lotteries were in the 15th century, where towns would hold drawings to raise money for town fortifications and for the poor. They also dangled the prospect of instant riches for the winning ticket holders, and this is an enduring appeal in a world where wealth disparity persists.

In the United States, most states and the District of Columbia now have a lottery. The state-run games are marketed to consumers with the message that they support the state, and that they’re a good way for the public to make money. However, the percentage of state revenues derived from the games is lower than that for other forms of gambling.

Retailers of lottery tickets receive a commission on each sale. In addition, most lotteries offer incentive-based programs in which retailers are paid bonuses for exceeding certain sales criteria. This is in contrast to other types of gambling, where retailers are typically compensated only by the percentage of total revenue they bring in. The use of incentive-based compensation is designed to encourage retailers to sell more tickets, and is considered more effective at increasing sales than an increase in retailer commission alone.