Definition
A lottery is a scheme for the distribution of property, prizes, or money by chance among persons who have paid, or agreed to pay, valuable consideration for the opportunity to win. The three essential elements that courts and statutes have consistently required are: (1) a prize or something of value to be won; (2) chance as the determining factor in who wins; and (3) consideration paid by participants for the opportunity to compete. The absence of any one of the three elements has historically been the doctrinal escape hatch used to distinguish lawful contests and promotions from prohibited lotteries.
Common Language
Modern common usage (Wiktionary): A scheme for the distribution of prizes by lot or chance, especially a gaming scheme in which one or more tickets bearing particular numbers draw prizes and the other tickets are blanks; also informally, something decided by chance.
Historical common usage (Webster's 1913): A scheme for the distribution of prizes by lot or chance; especially a gaming scheme in which tickets bearing particular numbers draw prizes and the rest are blanks; figuratively, an affair of chance.
The legal meaning tracks the ordinary meaning more closely than most legal terms do, but the gap that matters is doctrinal: the common understanding treats a lottery as self-evidently identifiable, while legal usage demands rigorous analysis of all three elements. A sweepstakes requiring no purchase, or a skills competition awarding prizes, may look like a lottery to a layperson but fails the legal test at the consideration or chance element, respectively. That analytical gap has generated substantial litigation.
Common Confusion
LOTTERY vs. RAFFLE: These terms are sometimes used interchangeably in popular usage but are legally distinct in many jurisdictions. A raffle is typically a specific subtype of lottery in which participants purchase numbered tickets and winners are drawn from the pool of ticket holders — the structure matches the lottery definition exactly, but raffle statutes frequently create a separate (and more permissive) regulatory regime for charitable organizations.
LOTTERY vs. SWEEPSTAKES: A sweepstakes eliminates the consideration element through free entry alternatives, placing it outside lottery prohibitions in most jurisdictions. Conflating the two is the central error in promotional compliance work.
LOTTERY vs. CONTEST: A contest awards prizes based on skill or merit rather than chance, removing the chance element. The skill/chance boundary is frequently litigated and is not always clear-cut when schemes have both random and skill-based components.
Core Elements
The three-part test applied in virtually all American jurisdictions:
PRIZE: Something of value — money, property, or any other benefit — is awarded to one or more participants. The prize need not be cash; courts have found prizes in goods, services, real property, and intangibles.
CHANCE: The outcome is determined by lot, random draw, or any mechanism that human skill, reason, or foresight cannot materially influence. This is the element most contested in promotional contests; a sufficient skill component in determining the winner has been held to defeat the lottery classification in many jurisdictions.
CONSIDERATION: Participants pay money or something of value for the opportunity to participate. Modern promotional law has made this the most heavily litigated element — "no purchase necessary" provisions are specifically designed to eliminate consideration and bring a promotion outside lottery statutes.
Recognized Forms
/SUBTYPES
State-operated lottery: A lottery authorized, administered, and operated by a state government, generally under dedicated enabling legislation. Revenues typically flow to designated public purposes (education funds, infrastructure). Now lawful in the majority of U.S. states.
Private lottery: A lottery operated by a private party, historically prohibited at common law and by statute across American jurisdictions, subject to specific statutory exceptions (charitable raffles, etc.).
Charitable lottery / raffle: A lottery in which proceeds benefit a nonprofit or charitable organization. Most jurisdictions carve out a specific exception from general lottery prohibitions, subject to licensing requirements and revenue limitations.
Promotional sweepstakes: A commercial scheme resembling a lottery but structured to eliminate the consideration element, typically through a free alternate means of entry. Lawful when properly structured but regulated under state prize promotion statutes in many jurisdictions.
Numbers game / policy game: Historically, an illegal street lottery in which participants bet on the appearance of a specific number sequence. Extensively discussed in 19th and early 20th century case law and legal dictionaries.
Why It Matters in Research
Researchers face three significant navigational challenges with this term.
First, the legal status of lotteries reversed dramatically over the course of American legal history. Through the 19th and most of the 20th century, lotteries were broadly prohibited — a paradigm case of police power legislation aimed at public morals. Beginning with New Hampshire in 1964, states began legalizing and operating their own lotteries, and by the late 20th century state-operated lotteries had become the norm rather than the exception. Sources predating the 1960s treat lottery prohibition as essentially settled law; post-1965 materials must be read against a transformed regulatory landscape. A researcher pulling 19th-century treatise authority on "the unlawfulness of lotteries" is reading a dead letter as to state-operated schemes.
Second, the three-element doctrinal test (prize, chance, consideration) generates cross-references in areas far removed from gambling law: advertising and promotional law, consumer protection, and First Amendment cases involving commercial speech regulation. Corpus searches limited to gambling or criminal law will miss significant lottery-adjacent doctrine in these areas.
Third, federal law adds a layer that state-focused historical sources do not address. Federal statutes have regulated the mailing and interstate transportation of lottery materials since the 19th century. The Lottery Case (Champion v. Ames, 188 U.S. 321 (1903)) was a foundational Commerce Clause decision, establishing Congress's power to prohibit interstate lottery traffic — a holding with constitutional implications well beyond gambling. Researchers working on Commerce Clause history or federal police power should treat lottery cases as a primary source vein.
Historical Dictionary Support
The historical dictionaries converge on the core definition: a scheme for distribution of prizes by chance. Bouvier offers the most analytically useful historical entry, providing both a structural definition and a doctrinal gloss — describing a lottery as a scheme in which "man's choice or will has no part, and which human reason, foresight, sagacity, or design cannot enable him to know or determine." This language anticipates the chance-versus-skill analysis that dominates modern promotional law. Black's (1st Ed.) is explicit about the consideration element, specifying "persons who have paid, or promised or agreed to pay, any valuable consideration," making the three-element structure visible even in the earliest edition. Rapalje & Lawrence is sparse — "a game of chance; a distribution of prizes by chance" — without engaging the legal test. Anderson's entry was not recovered in a usable form from the source material. None of the historical dictionaries address state-operated lotteries as a lawful category, reflecting their 19th-century prohibition-era context and rendering their normative framing obsolete for modern regulatory research.
Jurisdictional Note
All U.S. jurisdictions regulate lotteries, but the regulatory posture varies sharply. Most states now operate their own lotteries under constitutional or statutory authorization while maintaining criminal prohibitions on unlicensed private lotteries. State definitions of the three elements — particularly what constitutes "consideration" — diverge in ways that directly affect the legality of promotional sweepstakes and charitable raffles. Federal law (18 U.S.C. §§ 1301–1307) independently prohibits the mailing and interstate transportation of lottery materials, with exceptions carved out for state-operated lotteries and certain charitable schemes.