The lacto vegetarian diet excludes all meat, poultry, and fish, and it excludes eggs and every egg-derived ingredient. It permits dairy in essentially all forms: milk, yogurt, cheese, butter, ghee, cream, paneer, and kefir. Honey is typically permitted as well, though individual practitioners vary on this point.
This is distinct from two closely related diets. An ovo vegetarian eats eggs but avoids dairy. A lacto-ovo vegetarian eats both eggs and dairy, excluding only meat, poultry, and fish; this is the most common vegetarian pattern in the US and Europe, and the default most people assume when they hear "vegetarian" without qualification. Lacto vegetarianism sits in the opposite position: dairy in, eggs out.
The diet has deep roots in the Indian subcontinent. According to Wikipedia's overview of lacto vegetarianism, the practice traces back to ancient India and was later adopted by Western naturopaths and physicians, including Mahatma Gandhi, a well-documented lacto vegetarian and daily milk drinker. Within India, "vegetarian" is commonly understood to mean lacto-vegetarian by default, with eggs classified alongside meat rather than alongside dairy. That convention differs sharply from how "vegetarian" reads on a US or European product label, and it is the biggest source of confusion for people following this diet while shopping internationally.
The religious framework behind the diet explains why eggs are excluded while dairy is not. In Hinduism, the principle of ahimsa, or non-violence, underlies most vegetarian practice; milk from a living cow is viewed as obtainable without harm, while an egg is viewed by many as a potential life too closely tied to reproduction to be acceptable. Jainism applies a stricter version of the same logic, prohibiting meat, fish, eggs, alcohol, and honey outright while treating milk, curd, and ghee as nutritionally and ritually significant, according to Wikipedia's summary of Jain vegetarianism. Ayurvedic theory reinforces the pattern by classifying eggs as tamasic (tied to dullness) and dairy as sattvic (tied to clarity), which is why Sattvic-diet followers and Hindu wrestlers who train on milk, ghee, almonds, and chickpeas avoid eggs specifically rather than all animal products.