A precursor of the modern idli is mentioned in several ancient Indian works. Vaddaradhane, a 920 CE Kannada language work by Shivakotiacharya mentions "iddalige", prepared only from a black gram batter. Chavundaraya II, the author of the earliest available Kannada encyclopaedia, Lokopakara (c. 1025 CE), describes the preparation of this food by soaking black gram in buttermilk, ground to a fine paste, and mixed with the clear water of curd and spices.
The Western Chalukya king and scholar Someshwara III, reigning in the area now called Karnataka, included an idli recipe in his encyclopedia, Manasollasa (1130 CE). This Sanskrit-language work describes the food as iḍḍarikā.The food prepared using this recipe is now called uddina idli in Karnataka.
The recipe mentioned in these ancient Indian works leaves out three key aspects of the modern idli recipe: the use of rice (not just urad dal), the long fermentation of the mix, and the steaming for fluffiness. The references to the modern recipe appear in the Indian works only after 1250 CE. Food historian K. T. Achaya speculates that the modern idli recipe might have originated in present-day Indonesia, which has a long tradition of fermented food.
According to him, the cooks employed by the Hindu kings of the Indianised kingdoms might have invented the steamed idli there, and brought the recipe back to India during 800-1200 CE. Achaya mentioned an Indonesian dish called "kedli", which according to him, was like an idli. However, Janaki Lenin was unable to find any recipe for an Indonesian dish by this name.
The Gujarati work Varanaka Samuchaya (1520 CE) mentions idli as idari, and also mentions its local adaption idada (a non-fermented version of dhokla).The earliest extant Tamil work to mention idli (as itali) is Maccapuranam, dated to the 17th century.
In 2015, Chennai-based Idli caterer Eniyavan started celebrating March 30 as the "World Idli Day".
Argument about Invention:
Both Tamil Nadu and Karnataka claim to have invented this recipe. There are references to the making and existence of idli from the 8th century. But many of us will be surprised to know there are claims that idli did not originate in South India at all. Some food historians believe idli was derived from some steamed rice preparations from Indonesia.
It is believed that this recipe was invented by the cooks of the Hindu kings who ruled some parts of Indonesia.
The second claim contradicts this, as some of food historians claim that idli was introduced to South India by Arab traders, who had been in constant contact with the southern coast.