What Is a Raffle?

When running a giveaway, it’s important to understand the legal requirements to stay compliant.

A raffle is essentially a form of lottery, so you need to be mindful of rules around lottery laws to avoid any unintended complications.

A raffle is a type of lottery where participants buy tickets for a chance to win prizes. Each ticket has a unique number, and winners are chosen through a random draw.

A raffle is considered a game and a type of gambling competition, and so has to comply with gaming and lottery laws. These are strict and require licensing. They also differ from country to country, or even state to state if you're in America.

They're usually held in person, at things like summer fetes or school events, but they also are becoming more and more popular online.

A raffle is usually in aid of a charity or a good cause - essentially it is a non-profit/non-commercial lottery.

Raffles have long been a go-to method for raising funds and driving engagement. They're especially popular at school fairs, charity events, and community fundraisers because they’re simple to organise, fun for participants, and most people are familiar with them.

For the organiser, they offer a low-cost way to encourage participation, people are far more likely to contribute if there’s a chance they might win something in return.

Raffles also create excitement. Whether it’s a small event or a large-scale campaign, the anticipation of the prize draw builds momentum and keeps your audience invested. They’re not just a fundraising tool, they’re a way to bring people together around a common goal, create buzz, and reward involvement.

The basic structure of a raffle is straightforward: participants buy a ticket (or several), and each ticket gives them a chance to win a prize. After all entries are collected, a winner is chosen at random, typically by drawing a ticket stub or using a digital randomiser if it’s an online raffle.

The process usually includes:

• Defining the prize (or prizes) on offer
• Selling or distributing tickets
• Setting a clear deadline for entries
• Conducting a random draw
• Notifying and awarding the winner(s)

Some raffles have a single big prize, while others include runner-up prizes to boost engagement. Regardless of the setup, it’s important that everything is clearly communicated from the start, what the prize is, how winners will be selected, and any rules around eligibility.

Raffles and giveaways might seem similar, but they have key legal and functional differences. A raffle typically requires payment to enter, this is what makes it a form of gambling and brings it under strict regulatory control. Depending on where you’re based, you may need a licence, and there may be limits on how and where you can promote it.

Giveaways (or sweepstakes), on the other hand, are usually free to enter. As long as there’s no purchase required, they’re considered promotional rather than gambling-related, making them much easier to run legally, especially online or across multiple regions.

If you're unsure which route to take, consider your goal. Want to raise money for a cause? A raffle might be best, but check the laws. Want to build your email list or social following? A giveaway will likely be the safer and more flexible option.

Raffles must follow local laws, like in some places getting a licence.

• Raffles are considered a type of lottery and must comply with local laws.
• Licensing may be required, depending on your location.
• Many laws require a free entry option to avoid gambling regulations.
• Be transparent about rules, prizes, and how proceeds will be used.
• You must ensure fairness by making sure you have a tool or method for random prize draws.

With Gleam, you can run a raffle with a free alternate method of entry to bypass no purchase necessary laws, which makes it easy to comply with regulations and promote your campaign anywhere.

Raffles often have state-specific rules, meaning you’re usually limited to promoting and gathering entries within your state. But if you run a sweepstakes with a free entry option, like signing up to your mailing list, you can promote it globally and reach far more people.

Get started with this super easy to use template:

If you’re clear about how the money is going to a good cause and make that obvious in your campaign, people will donate anyway, even though it’s not compulsory. With a wider reach and a strong message, you’ll probably raise even more funds.