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Elroy "Lucky" Kleinschmidt got his nickname from an incident at a Costco store where he went in to buy a new winch, realized he had to use the restroom, and slipped in a puddle of pee. The resulting injury left Lucky in constant pain. Lucky sued the store and received a $53,000 cash settlement, which caused his friends to see him as lucky -- hence, the nickname.

Lucky

Lucky refers to the cash settlement as "money," and one of his catchphrases is "I done slipped on pee-pee at the Costco." The Costco story is partially contradicted in the episode "Luanne Gets Lucky," where Lucky says that he was at the store purchasing a TV, rather than buying a new cable for his winch, and again, during the series, where he states "If I hadn't gone to get a cash advance, I wouldn't have slipped on pee-pee, wouldn't have got my settlement money, and never would have bought these rims ... it's scary to think about the road not traveled".

Lucky claims he will never have to work another day in his life, even though the settlement was nowhere near enough to cover his expenses for the remainder of his expected natural life, and soon he wises up to that. After the Costco "pee-pee" incident, Lucky tried to commit insurance fraud by intentionally harming himself on private property, which has damaged his credibility and earned him some scrapes with the law. Lucky said he once was a factory worker at a corn chip factory in Waco, although he never mentioned it to Hank when Hank volunteered to help Lucky write a resume, suggesting he made up the story instead of having an actual record of gainful employment.

Although at one point (episode (213) "Lucky's Wedding Suit" Season 11 Episode12), his funds had dwindled to $9,000, and Hank referred Lucky to Dale's Dead-Bug for some temporary work. Lucky and Dale did some horsing around on Dale's basement steps, the railing collapsed, and Lucky fell, injuring his back. With some regret, Lucky filed a lawsuit against Dale. However, events quickly spun out of control, and Lucky's attorney threatened to sue Strickland Propane instead (on the grounds that Hank was acting as a Strickland employee when he referred Lucky to Dale), correctly sensing higher fee potential in suing Strickland than in suing Dale. With the help of Dale and Hank, Lucky was able to manipulate things so that the attorney would come out on the wrong end of a lawsuit, and the attorney ended up cutting Lucky a check for $53,000 (His "usual lawsuit fee and not a penny more") to make the whole thing go away.

Lucky has a definite tendency toward scam artistry, as seen in his lawsuit against Dale and subsequently getting a settlement from his own attorney. Lucky also went to great lengths to avoid paying a garbage-pickup tax, claiming the tax to be "un-American", by placing his garbage into Hank's garbage cans. Lucky is also somewhat dim: He once cut his hand on barbed wire and refused to go to the hospital because (he says) his family has a long history of getting shot in the woods and dying in hospitals.

In spite of his flaws, Lucky is a genuinely good-hearted person: He cares deeply for Luanne and always tries his best to do right by her. In "Edu-macating Lucky," where they learn that Luanne is pregnant, he tries to get his GED so that he'll be worthy by his own code of honor to ask Luanne to marry him. Lucky fails, due to Peggy intentionally tutoring him with wrong information (to which she later confessed), so he asks for and receives a shotgun wedding from Hank, thus doing the right thing by Luanne while remaining true to himself -- and finally being welcomed into the Hill family. Lucky also shows his devotion to Luanne in the episode "Life: A Loser's Manual" when he protects Luanne from learning that her father is in prison, preserving Luanne's good image of her father by allowing her to continue believing that he is an oil rig worker instead of a convict.

Lucky's and Luanne's daughter Gracie is born in the episode "Lucky See, Monkey Do." Lucky believes that "She carries a strong resemblence to my side of the family.. though that may change once she gets teeth."

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