Sweepstakes vs contest vs lottery: what creators are actually running

Last reviewed 2026-08-05

A sweepstakes awards a prize by chance with no consideration. A contest awards a prize on judged skill, which removes chance and can permit an entry fee in some jurisdictions. A lottery has all three elements, and in the US and Canada is reserved to the state or licensed operators. Most creator giveaways are sweepstakes; the usual way one becomes a lottery is attaching money to entry.

General information published by Dollar Fan Club — not legal advice. Read the full notice.

Three elements, three outcomes

Promotion analysis in the US and Canada turns on a prize, an element of chance in choosing the winner, and consideration — something of value the entrant gives up. Which of the three are present decides which promotion you are running, and the label you use has no effect on the answer.

Sweepstakes

A prize, a random winner, and entry that costs nothing. That is a sweepstakes and it is what almost every creator giveaway is trying to be. The requirement people break is the last one, usually without meaning to.

Contest

In a skill contest the winner is judged rather than drawn, and because chance is gone some jurisdictions permit an entry fee. That holds only if the judging is real: criteria published before entries open, weightings if you have them, identifiable judges applying them consistently, and a tie broken by further judging rather than a coin flip.

Lottery

Attach payment to a random draw and you have a lottery. The federal statutes in the US do not create a general "private lottery" offence in the abstract; they attack the machinery — carrying lottery matter through the mail under 18 U.S.C. § 1302 and postal enforcement under 39 U.S.C. § 3005 — while the definition of the offence itself lives in state law, which varies. In Canada, section 206 of the Criminal Code restricts lottery schemes, with lawful operation reserved largely to provincial and licensed operators.

Borderline cases worth recognising

• "Every $10 spent this week earns an entry", with no free route — a paid chance draw.
• "Paid members are entered" with no way in for non-members — see can subscribers receive giveaway entries.
• A submission fee followed by a random pick among the submissions — chance was never removed.
• A raffle for a cause. Charitable raffles are usually licensed gaming activity in their own right, not a giveaway.
• A vote-based winner. Popularity is not judged skill, and vote-buying turns it back into something else again.

The Canadian adjustment

Canadian promotions conventionally add a skill-testing question so the outcome is not decided by pure chance. If any entrant may be Canadian, read Canadian giveaway rules for creators — it also covers the Québec regime that ended in 2023.

Sources

• 18 U.S.C. § 1302 — Mailing lottery tickets or related matter — Cornell Legal Information Institute · Statute — Tier 1
• 39 U.S.C. § 3005 — Unlawful matter; false representations; lotteries — Cornell Legal Information Institute · Statute — Tier 1
• Criminal Code, s. 206 — Offences in relation to lotteries and games of chance — Justice Laws Website, Government of Canada · Statute — Tier 1

Terms used on this page

• Sweepstakes
• Contest (skill contest)
• Lottery
• Consideration
• Skill-testing question

Related guides

• How to legally run a social media giveaway — The overview: which layer of law applies to a creator giveaway (federal, state or provincial, and platform), what belongs in your official rules, and when to get advice.
• Canadian giveaway rules for creators (including the Québec change) — What changes when Canadians can enter: no paid entry, a skill element, adequate and fair disclosure — and why Québec's old publicity-contest filings ended on 27 October 2023.

Continue reading

• YouTube giveaway rules: required, prohibited, and recommended — Running creator giveaways