Etymology

one-armed bandit

one-armed ban·dit

Today it means: A gaming machine having a long arm-like handle at one side that a player pulls down to make reels spin; the player wins money or tokens when certain combinations of symbols line up on these reels. Full definition →

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The story

From one-armed (“having only one arm”) + bandit (“one who robs others in a lawless area, especially as part of a group; one who cheats others”), referring to the fact that the machine is operated by a single handle, and “steals” money from losing players.

Etymology from Wiktionary, CC BY-SA 4.0.