1. Several centuries ago, it was common practice for invading armies to divide the spoils after they had won a battle. Whatever goods they had captured, such as money or livestock, would be divided among themselves to keep.
2. The boys from two rival camps decided to compete for a gallon of ice cream. The winning team would get to divide the spoils and the losing team would get nothing.

The expression is used literally in the context of war, but it can also be used figuratively, as in opt.2.