The California State Lottery Act was approved by 58% of Californian voters on 6 November, 1984, and was created to generate funding for the state's public schools. In the period 1985 - 2006 the California Lottery (CL) generated more than $18 billion for public education funding. Institutions benefiting from this funding include K-12 schools, community colleges, University of California, California State University, adult education and charter schools, plus institutions under the umbrella of the Department of Corrections and Rehabilitation. Of every lottery dollar spent by players, almost 54% is returned to players in the form of prizes, and almost 35% forms CL's contribution to public education. Lottery sales in the 2005/06 fiscal year totaled over $3.5 billion.

As at early 2010, California Lottery sells lottery products at over 20,500 retailers.

CL lottery retailers can redeem prizes up to $600, or players can take the option of filling out a claim form and mailing the winning ticket. Winners of prizes over $600 should verify the win at a ticket retailer, then ask for a claim form and take in person, or mail the he ticket and form to on of the Lottery District Offices, located in South San Francisco, Sacramento, Hayward, Van Nuys, San Bernadino, Santa Fe Springs, Santa Ana and San Diego. CL advise that players photocopy both the claim form and the front and back of the ticket, for their records.

It is also advisable as soon as possible after purchasing your ticket to sign your name in ink on the back of the ticket, as if tickets are unsigned anyone in possession of a winning ticket may file a claim. Be sure to make a copy of any claim forms and tickets for your records.

Winners have 180 days after the date of the draw in which to make their prize claim. Prizes are not exempt from Federal tax, and by law, CL must notify the Internal Revenue Service of cumulative total prize winnings of $600 or more. Non-residents of California may buy tickets, and in the event of a win they need to mail in a claim form accompanied by the ticket.