History of the Lottery


There are many ways to win money from the lottery. Some lottery players choose to get a lump sum payment, and the money is invested to increase its value. Others choose to have their payouts spread over a period of time, with payments increasing with inflation. In either case, taxes are deducted from the lump sum, making the lottery payouts less than the jackpot amount. In addition, some lotteries offer annuity options, which pay out a larger amount of money over a longer period of time. Annuities are taxed lower than a lump-sum payment.


The history of lottery gambling stretches back to the ancient world. The earliest recorded lotteries were held in ancient Egypt, where people used them to settle legal disputes, assign property rights, and allocate unpopular jobs. Lotteries were also used by the ancient Romans as a way to raise money for various projects. Later, the lottery spread throughout Europe, where it was first used by the Roman Emperor Augustus to raise funds for public projects. In Dutch, the word lottery means “fate.”

The earliest recorded game of chance goes back to the Middle Ages. The nobility of the Holy Roman Empire and the ancient city-states of Rome used lotteries to fund public events. Although the game sprang from these early games, it resurfaced in Europe in the fifteenth and sixteenth centuries for other purposes than entertainment. In fact, the word lottery comes from the Dutch noun ‘lot’, which means “fate.”

Origins in the U.S.

The origins of the modern lottery can be traced back 300 years, beginning with a public-private lottery held in 1799 in New Amsterdam, New York. This lottery helped build the colony’s infrastructure. Several years later, in the 1820s, a national lottery was created and competed with state lotteries. It helped establish the District of Columbia and caused many legal battles over state rights.

The first lotteries in the United States were created by colonial governments hoping to raise funds for their settlements. In 1612, King James I of England created a lottery to provide funds to the Jamestown settlement. Lottery funding quickly spread throughout the colony, with many public and private organizations using it to fund public services, wars, colleges, and public-works projects. While lottery funding did not bring in large sums of money, it continued to be an effective means of raising funds for these public services.

Origins in Europe

The lottery originated in the Low Countries, where towns held public lotteries to raise money for the poor and fortifications. In fact, some towns held public lotteries more than a hundred years before the modern lottery. A record from the town of L’Ecluse, France, dated 9 May 1445, refers to a lottery in which four hundred and thirty-four tickets were sold. The winner of this lottery won a prize of florins, roughly equivalent to US$170,000 today.

Origins in France

French lottery history begins in the seventeenth century. The monarchy had fought against private lotteries and had forbidden their establishment, but the lottery continued to grow. In 1661, the Parlement de Paris banned all lottery operations, and the monarchy was adamant that no one could operate a lottery without royal authorization. A Parlement ruling of April 9th of that year made it illegal to advertise or distribute lottery tickets in the kingdom without the permission of the monarchy. The monarchy did allow gambling, however, when it was needed to support public works or charitable causes.

In the eighteenth century, lottery games became popular in Paris. France had been nearly bankrupted by a financial crisis in 1719. Bankers devised financial instruments that concealed their debts, but once discovered, returned the debt. During this time, the lottery was introduced as a way to stimulate economic activity, as well as to promote good luck. This newfound prosperity eventually led to the rise of the lottery.