The work of Berezinskii, Kosterlitz and Thouless in the 1970s revealed exotic phases of matter governed by the topological properties of low-dimensional materials such as thin films of superfluids and superconductors. A hallmark of this phenomenon is the appearance and interaction of vortices and antivortices in an angular degree of freedom-typified by the classical XY model-owing to thermal fluctuations. In the two-dimensional Ising model this angular degree of freedom is absent in the classical case, but with the addition of a transverse field it can emerge from the interplay between frustration and quantum fluctuations. Consequently, a Kosterlitz-Thouless phase transition has been predicted in the quantum system-the two-dimensional transverse-field Ising model-by theory and simulation . Here we demonstrate a large-scale quantum simulation of this phenomenon in a network of 1,800 in situ programmable superconducting niobium flux qubits whose pairwise couplings are arranged in a fully frustrated square-octagonal lattice. Essential to the critical behaviour, we observe the emergence of a complex order parameter with continuous rotational symmetry, and the onset of quasi-long-range order as the system approaches a critical temperature. We describe and use a simple approach to statistical estimation with an annealing-based quantum processor that performs Monte Carlo sampling in a chain of reverse quantum annealing protocols. Observations are consistent with classical simulations across a range of Hamiltonian parameters. We anticipate that our approach of using a quantum processor as a programmable magnetic lattice will find widespread use in the simulation and development of exotic materials.