When it comes to creating a prototype, there are two main options: physical and digital.
You would be surprised to know how many times a physical prototype is used in the video game industry. Many game mechanics can be reproduced through board games, card games, miniature games, or just one sheet of paper with a pen and maybe a few coloring pencils.
Digital prototypes are a bit more complex to put together, but of course, their fidelity to the medium and ability to create real-time environments and handle complex calculations makes them the go-to choice. Most of the time, though, it is always a great idea to start very simply on paper, and then move to digital with clearer ideas.