Sometimes I wonder whether the world is being run by smart people who are putting us on or by imbeciles who really mean it.

Mark Twain (1835-1910) American writer [pseud. of Samuel Clemens]

(Misattributed)

Not found in Twain's work, and the phrase "putting [someone] on" post-dates Twain.

The quotation actually appears to come from Laurence J. Peter and Raymond Hull, The Peter Principle, ch. 7 (1969). Peter writes that during a lecture, a Latin American student named Caesare Innocente, said to him:

Professor Peter, I'm afraid that what I want to know is not answered by all my studying. I don't know whether the world is run by smart men who are, how you Americans say, putting us on, or by imbeciles who really mean it.

More discussion: slang - What is the origin of "putting someone on" - English Language & Usage Stack Exchange.