"Explanation" cooked up by unbelievers whenever something that contradicts the Masquerade is very, very public.
Hallucinations don't work that way — even if multiple people were exposed to the same hallucinogen, they wouldn't see the same thing. The only time it's remotely plausible is if the people were already expecting to see whatever it was they believed they saw (which, in fact, is a very large part of how Stage Magic is performed) — and even then, they probably wouldn't share the particular details of the hallucination.
It's up there on the Stupid Explanations Chart with "it was a weather balloon" except that it's said with a straight face. See also Gas Leak Cover-Up.
Note that mass hallucination and mass hysteria are two different things.
Explained in a lot of cases by people simply not wanting to believe in things like hostile aliens or demons from Hell coming to Earth. The stupid explanation works because people are willing to ignore the reasons a shared hallucination isn't actually possible if it means they can keep believing they didn't really see an army of demons last week.
- A Pokémon episode had the police attributing reports of an Aerodactyl attack to mass dreams.
- The mages of Mahou Sensei Negima! use something like this maintain their Masquerade. A villain attempting to reveal said Masquerade used just the opposite: remove people's logical reaction to disbelieve the mystic, then spread over the planet to make sure no skeptic is left unbelieving (magically powered suggestion on a massive scale).
- Galaxy Railways episode 12. An old woman is confused and thinks Manabu is her son... until she and her fields disappear, leaving behind a gravestone—seems she was a ghost. One character suggests that maybe it really was a ghost, or maybe it was a hallucination. Keep in mind that multiple people saw it and were able to talk to her and get knowledge they didn't already have, such as her name, which matched the name on the gravestone.
- Though it doesn't actually happen, the Russian government uses this excuse in Mobile Fighter G Gundam to ignore the Devil Gundam in favor of pursuing victory in the Fight, much to Nastasha's irritation—Argo was infected by it and she herself was nearly absorbed.
- In the old X-Factor comic, they blamed Inferno on mass hallucinations caused by A.I.M. satellites. At least it's plausible given the weird tech that villain groups have.
- In Arkham Asylum: Living Hell, Batman explains away the presence of demons and Hell on Earth by telling the Asylum staff that it was due to Scarecrow's fear gas. Jeremiah Arkham accepts the explanation and sends Crane to solitary confinement, much to Crane's bewilderment.
- In the Angel: After The Fall comics, after the Senior Partners break the masquerade by sending the whole city of Los Angeles to hell and then undo it, everyone still remembers it, but most of the muggles convince themselves that it was actually a shared mass hallucination. And someone makes a Hollywood film out of, so everyone outside of LA thinks it's fiction.
- The Men in Black do this after using their neuralyzers, wipe the targets' short-term memory and make them extremely susceptible to suggestions, allowing the Men in Black to craft a plausible suggestion that everybody "saw." And since it's the targets' own brains that create false memories to fill in the blanks of whatever basic explanation the MiB provide, the usual flaw in this trope doesn't apply: each person's brain will come up with something a little different, and thus the inconsistent details from one person to the next actually make the Masquerade more believable.
- EPA official Walter Peck's explanation for the ghosts in Ghostbusters:
Peck: These men use nerve gasses to induce hallucinations. People think they're seeing ghosts and they call these bozos, who show up with a fake light show.
- A minor version in The Beast from 20,000 Fathoms, where the hero, Dr. Nesbitt, lost in an Arctic wasteland, finds his colleague, George, raving about seeing a monster. Soon afterward, Nesbitt sees the monster himself, but George freezes to death. When he gets back to base, Nesbitt is told by his superiors that the cold can cause hallucinations, but since George saw the exact same thing, Nesbitt is not convinced.
- The Case For Christ: Lee brings this up as a possible explanation of the Resurrection, but this is debunked by an agnostic psychology professor.
- The ending of Contact has the folks on Earth writing off the experience of the protagonists as one big Mind Screw. In the film, there is only a single person sent through the machine, so it's written off as either a hallucination or something she made up.
- In Dragon Blood, the heroes plan to explain the appearance with a dragon that way. They come from a culture that likes dragons, so it would be believable. One of them even makes up songs about stupid people who believe in dragons, so that no one will believe they have actually seen a dragon.
- "Ghost V", a short story by Robert Sheckley has the protagonists land on a deserted planet and end up fighting joint hallucinations of the monsters they invented in their childhood. It turns out, the planet's atmosphere contains a hallucinogen that forces humans to relive their childhood fears, which became really dangerous if Your Mind Makes It Real.
- In So Long, and Thanks for All the Fish, soon after Arthur Dent lands to his shock on Earth, he is told that the Vogons' apparent destruction of the planet (the very premise of the series) was a CIA-induced mass hallucination. In fact, Dent has landed on an Earth rebuilt by the dolphins.
- The Master and Margarita, everything the Devil did is later explained as hypnosis, mass hypnosis, or, in one case, long distance hypnosis.
- In a Haruhi Suzumiya short story, Snow Mountain Syndrome, the plot of the entire story (almost a day long) was explained to Haruhi as shared Highway Hypnosis. From wandering in a blizzard.
- Graveyard School namedrops this in one book, then immediately has it subverted. It's never made quite clear how The Masquerade remained intact after a supposedly hallucinated dinosaur ate a teacher.
- Stanisław Lem's The Futurological Congress describes drugs so effective at masking the reality that the subject cannot tell which of his perceptions have been altered, and which have not. Everyone is under the influence, but the protagonist takes a drug that cancels the effect.
- Averted(?) in the Ray Bradbury story "The Earth Men" (republished in The Martian Chronicles): the Martians are a race of telepaths and can easily share hallucinations.
- In The Dresden Files book Dead Beat witnesses to the climax involving Harry reanimating a zombie T-rex and riding it into battle through the streets of Chicago apparently let themselves be convinced that it was an example of this trope caused by a hallucinogenic reaction to the spores from a batch of mouldy bread. Harry is fully aware how ridiculous this explanation is, but chalks it up to another case of humans swallowing anything rather than face up to the implications of what they've seen. To be fair, though, this particular incident is so ridiculous that even people who might normally be open to the idea of the supernatural would probably find the bread explanation less absurd.
- Doctor Who and Torchwood. Thank God for Martha.
- It seems to be implied in Doctor Who that it isn't so much a case of outright disbelief so much as humans responding to the threat of something very scary and out of their control with the rather useless tactic of pretending it didn't happen. Evidence that this is the case was provided in the 2007 Christmas episode, where the Doctor found London to be almost completely deserted due to the usual inhabitants having realized that Christmas in London equals dangerous weird stuff, and cleared off.
- In the first episode of Torchwood, Gwen tells Jack that Rhys is convinced that a lot of the weird alien goings on were the results of drugs in the water and mass hallucinations (to which Jack replies "Well, your boyfriend is stupid.").
- In CSI, Grissom refers to the alien conspiracy theorist club as having a shared mass hallucination. Of course, they saw this as a part of the evil police force working for the reptilians trying to put them down.
- House: In the episode "Airborne" a passenger of a plane develops some of the symptoms of a highly contagious virus. Soon the other passengers start to develop the same symptoms. It turns out to be a case of mass hysteria, the original passenger has a case of altitude sickness, which is not contagious. Hysteria caused the other passengers to feel sick and even develop rashes and nausea.
- One story says that after the resurrection of Jesus, Roman troops were coerced into claiming that Jesus' disciples overcame them and stole the body, despite them all having good alibis. After reports of Jesus walking and talking for a full forty days after his alleged demise, the Romans claimed that he was Only Mostly Dead despite three days being far more than any human could survive without treatment after flagellation alone, much less flagellation, crucifixion, and a spear wound. Somewhat subverted in that Christianity eventually became the official state religion of the Roman Empire.
Of course, even according to the Gospels, people who knew Jesus well took a long time to recognize him as who he was, thus it can be questioned if he was indeed the same person before and after the crucifixion. Since these accounts were also written down only decades after when the time when these events were said to occur (and without being attested elsewhere) exactly what truly happened remains debated by historians. While one theory is indeed of hallucination, more reasonable people will claim that perhaps one or two disciples at best had these (actually not unusual on the death of a loved one) and it then grew in the telling. Paul too is often pointed to, since he only claimed to have a vision of Jesus (and some of his comments have been cited as indicating his possibly suffering from epilepsy, which causes hallucinations sometimes).
- In Professor Layton and the Diabolical Box, it's the explanation for the entire second half of the game. The game uses the "expectations" justification by having photos of the town set up at the train station. Since all the main characters get to the town by way of the train, they all see the photos so they all see the same thing. Presumably, any varying details aren't worth talking about. This is also the justification for why the box is able to kill people. It has a little bit of the gas in it, so anyone who opens it expecting to die, will.
- One of the central ideas in Chaos;Head, but it runs on the idea in reverse: if you can get more than one person to see the same thing (real or not), it becomes real. Whether it's explained as magic or science depends on the character given the explanation, although the story focuses more on the scientific one.
- A penis panic is a form of mass hysteria where groups of people suddenly become convinced that their genitals are shrinking or disappearing. Many other strange mass hysterias and hallucinations have also occurred in history, such as those documented in the book Extraordinary Popular Delusions and the Madness of Crowds.