A Lie system is a time-dependent system of differential equations describing the integral curves of a time-dependent vector field that can be considered as a curve in a finite-dimensional Lie algebra of vector fields $V$. We call $V$ a Vessiot--Guldberg Lie algebra.
We define and analyse contact Lie systems, namely Lie systems admitting a Vessiot--Guldberg Lie algebra of Hamiltonian vector fields relative to a contact manifold. We also study contact Lie systems of Liouville type, which are invariant relative to the flow of a Reeb vector field. Liouville theorems, contact Marsden--Weinstein reductions, and Gromov non-squeezing theorems are developed and applied to contact Lie systems. Contact Lie systems on three-dimensional Lie groups with Vessiot--Guldberg Lie algebras of right-invariant vector fields and associated with left-invariant contact forms are classified. Our results are illustrated by examples with relevant physical and mathematical applications, e.g. Schwarz equations, Brockett systems, quantum mechanical systems, etc. Finally, a Poisson coalgebra method to derive superposition rules for contact Lie systems of Liouville is developed.