Nightmare difficulty is a new difficulty setting that features a new starting weapon, the Flintlock repeater, and more enemy encounters.
Nightmare difficulty unlocks after completing the game on any difficulty.
If you previously completed the game on a version earlier than Version 1.02, the fastest way to unlock Nightmare difficulty is to load your last save file before the end of the game, change the difficulty to Easy in the settings, and complete the game.
Build and release context
Steam update times within 24 hours of this post. Matching dates do not confirm which build it describes.