A prayer flag is a colorful panel of rectangular cloth, often found strung along mountain ridges and peaks high in the Himalayas. They are used to bless the surrounding countryside and for other purposes. Prayer flags are believed to have originated with Bon, which predated Buddhism in Tibet. In Bon, shamanistic Bonpo used primary-colored plain flags in healing ceremonies. They are unknown in other branches of Buddhism. Traditionally they are woodblock-printed with texts and images.

The Indian Buddhist Sutras, written on cloth in India, were transmitted to other regions of the world. These sutras, written on banners, were the origin of prayer flags. Legend ascribes the origin of the prayer flag to the Shakyamuni Buddha, whose prayers were written on battle flags used by the devas against their adversaries, the asuras. The legend may have given the Indian bhikku a reason for carrying the heavenly banner as a way of signifying his commitment to ahimsa. This knowledge was carried into Tibet by 800 CE, and the actual flags were introduced no later than 1040 CE, where they were further modified. The Indian monk Atisha (980 – 1054 CE) introduced the Indian practice of printing on cloth prayer flags to Tibet and Nepal.