Official lottery is a type of game in which many people buy tickets to win prizes. It is usually organized so that a portion of the profits is donated to good causes.

The term lottery is derived from the Dutch word lotterie, meaning “the action of drawing lots.” It refers to a procedure in which a number or series of numbers or symbols are drawn by chance and used to determine winners. The process may be conducted by a human or computer, or by a mechanical means such as shaking or tossing.

Winning numbers are matched by the drawing process and then paid out in one of two ways: either in cash or as an annuity payment. In the U.S., the winner has a choice of receiving a lump sum or a cash payment with taxes applied.

A winning ticket is usually given to the person who bought it, but it can also be sold or transferred to another person. Prizes are credited to a player’s sweep account, and this can be done through electronic funds transfers.

Historically, lotteries were held in Europe during the 15th century as towns attempted to raise money for their defenses or to aid the poor. They were not considered to be a form of gambling and, as a result, they were not illegal.

In the early 18th century, lotteries were outlawed in many jurisdictions, although some states remained in existence for some time. They generated a small but significant amount of revenue, but a large proportion was consumed by administration costs.