The video is set to archive commentary from an episode of The Joy Of Painting with Bob Ross.
It opens with American painter Ross saying: “Hello, I’m Bob Ross. I’d like to welcome you to The Joy Of Painting.
“Got all your materials out, ready to do a fantastic painting with me? Good.”
The footage then turns to Banksy picking up and carrying a ladder, then picking out spray cans, in the dark.
Banksy places a stencil for his piece on the wall of Reading Prison and begins to spray it with black paint.
The artist wearing a headtorch, then sprays white paint before using a roller to apply grey paint.
He applies water to the piece, as Ross encourages viewers to do so, then completes the typewriter as sirens are heard.
Finally, Banksy uses a marker pen to represent words from the typewriter.
Footage shows the completed piece in daylight as Ross says: “Painting to me represents freedom. I can create the kind of world that I want to see and I want to be part of.”
People are shown gathering to look at the piece, which appeared on the wall on Monday.
Two police officers appear to inspect the piece as Ross says: “That really is the fun part of this whole technique, so from all of us here, I’d like to wish you happy painting and God bless my friend”.
Reading Prison is renowned as the location where Oscar Wilde served two years’ hard labour for “gross indecency”.
Although the site closed to prisoners in 2013, its future is currently the focus of fierce debate.
The Ministry of Justice which owns the building, is due to decide by March 15 whether it will be turned into an arts venue.
There are fears that if that bid by Reading Borough Council is unsuccessful, the Grade II-listed site could be sold to property developers.
Speaking after the piece was confirmed as a Banksy, Toby Davies, artistic director for RABBLE Theatre in Reading described it as “fantastic”.
“It adds real kudos to the whole campaign to have someone who knows a thing or two about culture take a risk and come and do this on a Ministry of Justice building,” Mr Davies told the PA news agency.
“It is phenomenal, it really displays how much it means to people.
“Whenever I speak to people, not just those in the culture world but those who walk past it every single day, they get very emotional about it.
“We understand in Reading that housing is needed but there are multiple sites in Reading and Berkshire for housing developments.
“Reading has never had the opportunity to have a go at an international culture centre that brings people together.
“It should be a bubbling centre of UK culture but it isn’t and that’s because we’ve never been given a chance.
“If there was ever a chance then this is it and it won’t come again.”
The campaign to turn the site into an arts hub has won the support of Stephen Fry, Dame Judi Dench Sir Kenneth Branagh and Natalie Dormer.
Mr Davies highlighted that Banksy had created the piece while England is under lockdown restrictions.
“It is a significant personal risk from him. I think it’s incredible to have done it at this time when the campaign is at this point,” he said.
“It speaks volumes. He could have gone to wider issues around the world, there are plenty of them, but he has come to Reading to highlight this.”
Matt Rodda, Labour MP for Reading East, tweeted that there was a “growing sense of excitement” in Reading following confirmation that the piece is a Banksy.
Mr Rodda previously said it showed the “national and international importance of this unique historic building”.
A spokesman for Reading Borough Council said: “We are thrilled that Banksy appears to have thrown his support behind the Council’s desire to transform the vacant Reading Gaol into a beacon of arts, heritage and culture with this piece of artwork he has aptly called ‘Create Escape’.
“The Council is pushing the Ministry of Justice, who own the site, to make suitable arrangements to protect the image.”
Wilde was jailed after being convicted of gross indecency in 1895 following a retrial and later penned his final published work “The Ballad of Reading Gaol” highlighting the need for reform of inhumane conditions.
In December, a Banksy artwork entitled “Aachoo!!”, was discovered on the external wall of a semi-detached house in Bristol.
It depicts a pensioner in a headscarf sneezing and her dentures shooting out of her mouth.
Back in October, a tongue-in-cheek artwork appeared on a brick wall on the side of a beauty parlour at the corner of Rothesay Avenue and Ilkeston Road in Lenton, Nottingham.
The mural of a little girl hula hooping with what appears to be a bicycle tyre was painted next to a battered bike chained to a lamp post with an infinity lock, and the bike was missing a tyre.
In July last year, Banksy’s artwork inside a London Underground train carriage, with messages about the spread of coronavirus, was removed by Transport for London (TfL).