What is a smoking gun? Where does the phrase come from?

A smoking gun is piece of incontrovertible incriminating evidence. 
The phrase was first used in the Sherlock Holmes story, The Gloria Scott (1893). 
We rushed into the captain's cabin . . . there he lay with his brains smeared over the chart of the Atlantic . . . while the chaplain stood with a smoking pistol in his hand.
William Safire the identifies the first contemporary use as during the Watergate scandal in 1974. 

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