This article examines the evolution of the mechanism of legal regulation of lottery activities in Russia, aimed at attracting additional funds for the implementation of social expenditures of the state. The powers of local authorities are studied in detail in terms of authorizing lotteries and organizing lottery activities, as well as control and supervisory powers for holding local lotteries. The article analyzes the practice of holding lotteries, and indicates that there were a large number of violations, theft of these funds, abuse, deception and other offenses, which led to a significant decrease in public confidence in this mechanism for financing social expenditures. The article provides examples of various lotteries held during the period of time under study in various parts of the state, mechanisms for resolving such lotteries, shows the purposes of their holding, as well as the organizations that carried them out. The work draws a general conclusion that both in pre-revolutionary Russia and the first years of Soviet power, lotteries acted as a universal mechanism for local authorities to generate additional income necessary to fulfill the social tasks facing them. However, the imperfection of legal regulation and the lack of proper control by the state over their implementation discredited lotteries in front of society and their implementation at the local level completely ceased by the end of the 20s of the 20th century.