Highland Council is having to find millions of pounds in savings.
Budget leader Bill Fernie said rising costs and a reduction in funding from the Scottish government has left the council with a budget gap of Â£17-18m.
The simulator includes options in finding savings by reducing spending on schools and public toilets.
Available until 5 February, the local authority said it hoped it would generate feedback from people living in the Highlands on the running of council services.
Mr Fernie said: "We have done our best to look at how we can make savings whilst causing the least impact on essential services and jobs.
"We have identified a range of savings to reduce this gap and before we put our full proposals to council, we would like to understand what is really important to people in the Highlands."
He added: "The council cannot spend more than it has and there are some areas of the budget that have fixed costs and we cannot cut. The simulator cannot include the entire budget for this reason, but challenges residents to attempt the difficult task of cutting Â£14m from the budget."
A Scottish local authority has challenged the public to try and balance its books using an online budget simulator.