Matka is a very popular game in Mumbai and in Gujarat.
It originated as a game called Ankadar Jugar, when people would bet on the closing price of cotton in the New York stock exchange.
It became popular in the 1970s when Rhatan Khatri ran the matka racket in Mumbai. He was known for his honesty and had the daily cards drawn by well known celebrities or sometimes random members of the public. His relations with high society gave him credibility and there was a campaign to make him Prime Minister after the death of Indira Ghandi.
Since Rhatan Khatri retired in the late 90s matka has seen a drop in popularity. The mafia has taken control of the game and punters do not know whether the draw is fixed or not and it is thought that it usually is.
The way the game works is similar to a lottery. There are two draws of three numbers per day, these are called the opening draw and the closing draw. They are drawn at 9pm and at midnight respectively. They are drawn from a pack of cards with numbers zero to nine. So a typical draw might be 469. The numbers of the draw are added up, so it would be 19 in this case. The last number is taken and so the opening number would be 9 (as you just take the second number) so the draw would be represented like this: 469 9X.
The next draw takes place at midnight and is the closing draw, it might be 257, which would make the closing number 4 (from the 14) and the full draw would be displayed as 469 9X4 257.
People bet on all of these outcomes at various odds. People bet on the two three digit numbers. They bet on the opening and closing numbers (In this case 9 and 4). They also bet on the opening and closing number combined (In this case 94). Finally they bet on the sums of the opening and closing draws (In this case 19 and 14). So you have odds that vary from 9/1 to 999/1.
For more information about Matka and daily Matka draws, see Matka.com.