A lottery is a state-run contest where the winnings depend on luck or chance. There are many different kinds of lotteries, but they all work when there is a great demand for something and only a limited number of winners can be chosen at random. A lottery can be as simple as buying a ticket, or it can be much more involved, such as the way schools choose students.

Unlike games with a growing jackpot, these types of lotteries usually have fixed prizes that are paid out to all players who correctly guessed all the numbers. The prize money is commonly the total amount of money collected from ticket sales after expenses and profit for the promoter are deducted, though some lotteries may have a prize pool that grows depending on the number of tickets sold.

In the US, these kinds of lotteries are regulated by state laws and overseen by a lottery commission. Generally, these agencies select retailers, train them to use lottery terminals, and ensure that retail employees are following the state’s rules and regulations on the sale of lottery tickets. They also collect and distribute the high-tier prizes to winners and are responsible for ensuring that retailers, players, and promoters are all complying with state laws.

Lotteries are common ways to raise funds for things like public services or construction projects. They are often popular with people because they offer a low risk and a high possibility of winning a large sum of money. While some governments outlaw or ban them, others endorse them to a certain extent and organize a national or state lottery.