Full Idea
The 'actualist' HOT theory says that a state is conscious if the subject is 'aware' of it, where this is understood as a matter of the subject forming some actual Higher-Order judgement about it.
Clarification
HOT stands for higher-order thought
Gist of Idea
The 'actualist' HOT theory says consciousness comes from actual higher judgements of mental states
Source
David Papineau (Thinking about Consciousness [2002], 7.11)
Book Reference
Papineau,David: 'Thinking about Consciousness' [OUP 2004], p.205
A Reaction
As stated there seems an obvious regress problem. Is the consciousness in the mental state, or in the higher awareness of it? If the former, how does being observed make it conscious? If the latter, what gives the higher level its consciousness?