The number represents about one student for every high school in the state.
The scholarship program, in effect since 2000, called "Leaders of Tomorrow," provided $5,000 for each winning student. The program has helped thousands of city students go to college.
Officials for the New York State Lottery Friday blamed Governor David Paterson's demands for all state agencies to cut their budgets by 10 percent.
Paterson responded to the criticism saying the actions would be inexcusable in normal times, but "the world has changed."
The cut will save the agency about $1.4 million.
Last year, the New York State Lottery took in about $7.5 billionr.
In an interview with Eyewitness News, Dr. Laurence Aurenstein, the superintendent of the Glen Cove Schools, asked what the New York Lottery planned to do with the million-and-a-half savings? Dr. Aurenstein said the loss of the scholarship money "would hurt kids who are trying to pursue their careers."
A spokeswoman for the New York State Lottery said officials hoped to restore the scholarships next year.
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