Illegal gambling is generally defined as an activity where a person provides consideration for the opportunity to win a prize in games of chance. Consideration typically takes the form of currency, but it can be anything of value (hence the idiom, losing your shirt). If there is no consideration, or the game is deemed a game of skill instead of a game of chance, then the game will be legal in most jurisdictions.
Traditional games of chance are lotteries, where you buy a ticket to match randomly drawn numbers to win money, and craps, where the prize is dependent on the roll of the dice. However, the bright line rules of games of chance become blurry when skill is involved. Depending on the state, games of skill fall outside of the scope of state gambling laws (in recent years our firm has written extensively on the issues involved in the fantasy sports games of skill debate). This raises the following question:
How do states determine whether the game is one of skill, one of chance or both?