The Simulation Hypothesis was first published by Hans Moravec (of the Robotics Institute, Carnegie Mellon University, US) in 1998. See Simulation, Consciousness, Existence

Then, in 2003, Professor Nick Bostrom, Director of the Future of Humanity Institute, Faculty of Philosophy & James Martin 21st Century School, Oxford University, published his paper 'Are You Living In a Computer Simulation?' (Philosophical Quarterly, 2003, Vol. 53, No. 211, pp. 243-255.)

This paper argues that at least one of the following propositions is true: (1) the human species is very likely to go extinct before reaching a 'posthuman' stage; (2) any posthuman civilization is extremely unlikely to run a significant number of simulations of their evolutionary history (or variations thereof); (3) we are almost certainly living in a computer simulation. It follows that the belief that there is a significant chance that we will one day become posthumans who run ancestor-simulations is false, unless we are currently living in a simulation."

The paper has since generated much philosophical debate - according to some philosophers, it's impossible to construct a proof or disproof. More info. here on the professor's website.

Note: This article is tagged 'Unfalsifiable' because non-one has yet been able to devise any form of experiment which could either prove or disprove the theory - let alone carry one out.

Also see :The 'Brain in a vat' problemplugin-autotooltip__plain plugin-autotooltip_bigThe 'Brain in a vat' problem

unfalsifiable

Philosophers have been puzzling over the 'Brain in a Vat' problem for several decades. The 'problem' comes down to arguments over whether it's possible (or not) to philosophically 'prove' that one (i.e. the observer) is not simply an isolated brain that is, in effect, imagining the entire world around it.