Mark Six fever has gripped poor communities in Hubei province, forcing many children to give up school because their parents can no longer afford to pay the fees.
The Financial Daily reported that the obsession began at a spring festival this year in Damu township, in the mountainous Xianan district, when a resident returned home for a holiday with her husband from Guangdong province, where the Hong Kong Mark Six draw can be seen on TV.
After they explained how Mark Six worked, two unemployed villagers organised their own version, even though gambling is illegal in China.
By May, 40,000 people were playing, including at least half the local officials and Communist Party members. They were betting between 200,000 yuan (HK$188,000) and 400,000 yuan a week, the report said.
The newspaper said many people were spending so much money they could not afford to send their children to school. There had also been an increase in superstition, with punters going to the temple to burn incense and pray for winning numbers.
The report said lottery fever was spreading to other communities and even approaching Wuhan, the provincial capital. Crowds regularly met on street corners and in shopping areas to compare numbers and trade tickets.