How to determine if a process runs inside lxc/Docker?

On a new ubuntu 16.04 system, new systemd & lxc 2.0

sudo grep -qa container=lxc /proc/1/environ

The most reliable way is to check /proc/1/cgroup. It will tell you the control groups of the init process, and when you are not in a container, that will be / for all hierarchies. When you are inside a container, you will see the name of the anchor point. With LXC/Docker containers, it will be something like /lxc/<containerid> or /docker/<containerid> respectively.

Docker creates a .dockerenv file at the root of the directory tree inside container. This can be seen by performing an ls -la /.dockerenv to show that it is created on container startup.

You can run this script to verify:

#!/bin/bash
if [ -f /.dockerenv ]; then
    echo "I'm inside matrix ;(";
else
    echo "I'm living in real world!";
fi

MORE: Ubuntu actually has a bash script: /bin/running-in-container and it can return the type of container it has been invoked in. Might be helpful. Don't know about other major distros though.