Setting up a development environment for creating Twilio Flex Salesforce plugins involves several steps, starting with creating a fresh Salesforce Sandbox or Developer Edition and setting up the necessary tools such as ngrok to expose the local instance of Flex. The guide also covers using Salesforce as an Identity Provider for Single Sign-On (SSO) and configuring the SSO settings in both Salesforce and Twilio Flex. Additionally, it provides instructions on adding the Call Center to Salesforce, customizing the UI, and integrating the plugin with the OpenCTI interface.