According to the ubiquitous Wikipedia, The tradition dates back to around the 16th and 17th centuries, when people would make garlands of flowers and leaves for the May Day celebration. After becoming a source of competition between Works Guilds, these garlands became increasingly elaborate, to the extent that it covered the entire man. This became known as Jack in the Green.
The Fowlers Troop Jack in the Green was revived by members of Blackheath Morris Men and friends in the early 1980s. It is a revival of a Jack in the Green from about 1906 which was taken out around Deptford, South East London on May Day by the original Fowlers Troop.
By the turn of the 19th century the custom had started to wane as a result of the Victorian disapproval of bawdy and anarchic behaviour – see my earlier comments on Easter Chair Heaving.
Yesterday being May Day, I wandered over to Southwark to watch a little bit of the parade – which being Morris Men was basically a glorified pub-crawl ;)
More details on their website.
A few more photos over on my Flickr account.