A sportsbook is a gambling establishment, either online or in a brick-and-mortar building, that accepts wagers on various sporting events. The term may also refer to a betting agency that places bets on behalf of customers, or a legal entity that offers wagering services in jurisdictions where gambling is illegal. A sportsbook may offer a variety of betting options, including money line bets, over/under bets, and prop bets. Several factors determine whether or not a sportsbook is legitimate, including its licensing requirements, advertising rules, and customer data management systems.

A Sportsbook and How It Makes Money

Sportsbooks make money the same way bookmakers do: by setting odds that guarantee a profit in the long run. To do so, they must set a margin that exceeds the probability of a given outcome and collect funds from losing bettors to offset these losses. This margin is known as the vig or vigorish, and it enables sportsbooks to balance bets on both sides of a game and mitigate their risk.

The first step in running a sportsbook is obtaining the necessary licenses and permits to operate legally. This process can take weeks or months, and it will involve filling out applications, providing financial information, and conducting background checks. It is important to clearly understand the licensing and advertising rules for your area before you start your business. Once you have the proper credentials, you can begin advertising your sportsbook to consumers. You should also invest in a reliable computer system to manage consumer data and keep track of revenues and losses.