An over-the-counter (OTC) contract is a bilateral contract in which two parties (or their representatives: brokers or bankers as intermediaries) agree- directly without involving an official exchange – on how a certain trade or instrument is to be settled in the future (OTC trading).

OTC contracts are traded in or through a regulated market. In over-the-counter markets, participants transact directly with each other, using the so-called over the counter (OTC) means of communication (e.g., telephone or online). In such a non-physical marketplace, a widespread assembly of dealers (market makers) and their clients transact away from the premises of organized markets. As opposed to trading on exchanges (bourses), over-the-counter trading takes place through communication means (telephone, computers, etc.) where buyers and sellers negotiate and strike deals. Instruments that trade over the counter are typically not listed (e.g., over-the-counter stock, swap agreements, etc.)

The main types of OTC contracts include options, forwards and swaps (e.g., interest rate swaps).