In the United States, state and territorial governments own and control the lottery. There is no single private company or federal agency that owns "the lottery." Each participating jurisdiction operates its own lottery under state or territorial law. Some lotteries are government agencies, while others operate as government-chartered or government-authorized corporations.
U.S. Lottery Ownership at a Glance
| Lottery type | Who owns or controls it? | Who operates it? |
|---|---|---|
| State lottery games | The relevant state government or government-authorized lottery corporation | The state lottery organization |
| District of Columbia, Puerto Rico and U.S. Virgin Islands lotteries | The relevant public authority or government | The local lottery organization |
| Powerball | Member lotteries through the Multi-State Lottery Association | The Multi-State Lottery Association, or MUSL |
| Mega Millions | Participating lotteries through the Mega Millions Consortium | The member lotteries collectively |
| Lottery technology and ticket systems | Private contractors may own the equipment or software | Contractors operate services under government contracts |
Who Owns State Lotteries?
A state lottery belongs to the state or its authorized public lottery organization. States create lotteries through legislation, constitutional amendments or voter-approved measures, depending on the jurisdiction.
The National Association of State and Provincial Lotteries says lotteries are regulated by state or provincial governments. It defines a lottery as an organization that administers lottery games, usually as a government agency, quasi-government agency or government-authorized corporation.
The California State Lottery, for example, is a public agency operating under the California Lottery Act. A commission appointed by the governor oversees it. The lottery provides supplemental funding for California public schools and colleges.
Does the Federal Government Own the Lottery?
No. The U.S. federal government does not own a national lottery.
Lottery authority generally belongs to individual states and participating U.S. territories. Federal rules can affect interstate ticket distribution and advertising, but they do not transfer ownership or daily control of state lotteries to the federal government.
Five U.S. states do not operate state lotteries: Alabama, Alaska, Hawaii, Nevada and Utah.
Who Owns Powerball?
Powerball is administered by the Multi-State Lottery Association, commonly called MUSL. MUSL is a nonprofit government-benefit association owned and operated by its member lotteries.
MUSL does not replace the individual state lotteries. Each participating lottery sells Powerball tickets in its own jurisdiction, follows local laws and handles winning-ticket claims under its own rules.
Powerball says its member lotteries retain profits and use them for programs approved by the legislature or another governing authority in each jurisdiction. More than half of Powerball ticket-sale proceeds remain in the jurisdiction where the ticket was purchased.
Who Owns Mega Millions?
Mega Millions is controlled by its participating lotteries through the Mega Millions Consortium.
The official Mega Millions website describes the consortium as a group of jurisdictions rather than a separate legal entity. Nine member lotteries govern the game and share responsibility for its rules, operations, finances, technology and public relations.
Individual state lotteries sell Mega Millions tickets. Local rules determine ticket sales, prize claims and whether online purchases are available.
Do Private Companies Own the Lottery?
Private companies generally do not own U.S. state lotteries or the lottery games themselves.
Private businesses may provide:
- Lottery terminals and ticket-processing systems
- Scratch-ticket printing
- Online lottery platforms
- Advertising and marketing
- Drawing equipment and security services
- Retail distribution and technical support
These businesses work under contracts. The government-authorized lottery retains legal control over the games, regulations, ticket sales and distribution of net proceeds.
A private retailer does not own the lottery either. Retailers sell tickets for the relevant lottery and may receive commissions or bonuses.
Who Receives Lottery Money?
Lottery ticket revenue is generally divided among:
- Prize payments
- Retailer commissions
- Operating and administrative expenses
- Transfers to public programs or other beneficiaries
The destination of the money depends on the law in each jurisdiction. California directs lottery contributions to public education. Other states use lottery proceeds for general government spending, scholarships, environmental programs, veterans' services or transportation.
In California, the State Controller's Office determines how lottery funds are distributed to public education institutions. The California Lottery says that 95 cents of every dollar spent on its games goes back to the community through prizes, retailer compensation and education contributions.