Lottery refers to a process of random selection to allocate something that is limited and in high demand, such as kindergarten placement at a reputable school or units in a subsidized housing block. There are many types of lottery. Some are financial and others occur in sport. In the NBA, for example, a lottery is held for the 14 teams that did not make the playoffs. The names of the top 14 are randomly drawn to determine their draft pick. The winning team thereby gets the opportunity to select the best player out of college.

While critics of lotteries argue that they function as a tax on the poor, supporters say they allow states to fund critical programs without raising taxes, which is particularly helpful for poor communities. They also say that the entertainment value of playing is sufficient to offset the disutility of a monetary loss.

The term is derived from the Dutch word lotterij, which in turn was probably a calque of the French loterie, and in turn a calque of Middle Dutch lotinge “action of drawing lots”. Government-sponsored lotteries are common around the world, with lotteries existing on every inhabited continent. Typically, the prizes for winning lottery games are very large but the frequency of winning is quite low. A percentage of the proceeds are normally deducted as operating costs and profit, leaving a very small portion to the winners. The larger jackpots attract a large number of potential bettors, which helps to drive ticket sales and generate free publicity for the lottery on news sites and newscasts.