Puzzles with the structure of the prisoner's dilemma were devised and discussed by Merrill Flood and Melvin Dresher in 1950, as part of the Rand Corporation's investigations into game theory (which Rand pursued because of possible applications to global nuclear strategy). The title “prisoner's dilemma” and the version with prison sentences as payoffs are due to Albert Tucker, who wanted to make Flood and Dresher's ideas more accessible to an audience of Stanford psychologists. Although Flood and Dresher didn't themselves rush to publicize their ideas in external journal articles, the puzzle attracted widespread attention in a variety of disciplines. Christian Donninger reports that “more than a thousand articles” about it were published in the sixties and seventies. A bibliography (Axelrod and D'Ambrosio) of writings between 1988 and 1994 that pertain to Robert Axelrod's research on the subject lists 209 entries. A Google Scholar search for “prisoner's dilemma” in 2014 returns 106,000 results.

The Prisoner's Dilemma turned out to be one of game theory's great advertisements. The elucidation of this paradox, and the demonstration of how each player brings about a collectively self-defeating outcome, because she is rational in pursuing her own interests, was one of game theory's early achievements which established its reputation among the social scientists.