The invention relates to a system (300) and method for performing end-to-end simulation and testing of an IoT application (102). An IoT data simulator (310) is configured to simulate an IoT environment using data received from different components in the IoT environment, which include IoT messages/data from IoT devices (106), master data from different databases (108) and data from third-party web services (110). Device templates are created that are used as blueprint for defining a plurality of device instances which include simulated device instances and live device instances. An IoT application validator (326) is configured for testing and validating the IoT application (102) by transmitting a plurality of IoT messages to the IoT application (102) and validating the behavior of the IoT application (102) to the plurality of IoT messages for all layers including, but not limited to, a UI layer (112), a business logic (114) and a data layer (116), using one or more device instances.