We’ll try to lay out a very rudimentary and general overview of the concept here for now.
The “Unity of Existence” is a very ancient concept. And Allah gives hints of it in the Quran. Further, the Hadith gives a few points that shed a bit more light on the concept. But the term got most of its popularity from ongoing discourses of Hazrat Ibn al-Arabi (ra). The idea in layman’s terms is that when there was nothing, aside from Allah. Everything that came to be is part of Allah. The building blocks of everything in its utter finality rest with Allah. So there’s Allah’s own being that unites everything in existence, since nothing exists that he did not become a building block of.
On the opposite end of this spectrum is the concept of “Wahdat ash-Shahood” or “Unity of Perception” that was taught by Hazrat Ahmad Sirhindi (ra). This concept also gained a lot of ground during the 1600s. This idea was thought to be an exact antithesis of Hazrat Ibn al-Arabi (ra)’s teachings. He believed in the concept that everything is united with Allah only in perception. And that once Allah created the creation, the creation is no longer in unity with Allah.