China's state-run People's Daily newspaper is known for political correctness rather than a sense of humor.

So when a report surfaced this week that North Korean leader Kim Jong-Un had been named the 2012 "Sexiest Man Alive", the self-described mouthpiece of the Chinese Communist Party cheered its Korean comrade on its website -- only this "news" came from satirical U.S. website, The Onion.

China is North Korea's major ally and aid provider. Reporting something flattering on Kim must have been considered politically correct. Its website editors even built a gallery of photos to accompany the report, with slides featuring Kim riding a horse, inspecting troops and being hugged by female soldiers.

While the item spiced up the usually staid pages of the website, it led to wave of sniggering as international media lampooned Chinese state media for being fooled by a bogus report from a well-known purveyor of offbeat humor and satire.

Was the omniscient People's Daily really this gullible or was it the work of a mischievous insider with a penchant for satire?

On Wednesday, a woman who took our call at the website's office in Beijing insisted that it was "impossible that the People's Daily would quote from any unreliable media -- we do verify our news and sources."

The woman, who declined to identify herself, said the story and pictures had been removed a day after being posted.

But the damage had been done and The Onion was relishing the publicity.

"Please visit our friends at the People's Daily in China, a proud Communist subsidiary of The Onion," read its statement. "Exemplary reportage, comrades."

Chinese micro-bloggers couldn't resist getting in on the act too.

"The world was fooled by the People's Daily, because no Chinese believes this paper," wrote @Hai_Dao_Wu_Bian.

So the Chinese have a sense of humor?

Christopher Rea, who is writing a book on the cultural history of humor in modern China, says the Chinese have "a robust sense of the farcical and the absurd, as well as a keen appreciation of watching those in power screw up."

Rea, a scholar at the Australian Center on China in the World, says "the Chinese sense of humor runs the same gamut as elsewhere."

Linda Jaivin, a veteran China-watcher and co-author of "New Ghosts Old Dreams," a book on Chinese literature and culture, said Beijing people's sense of humor tends to be "very topical, political and satirical."

When a giant statue of Confucius suddenly appeared in Tiananmen Square, not far from Mao's iconic portrait early last year, tongues wagged about what it all signified politically -- was Confucius back to dislodge Mao as China's spiritual leader?

The statue was moved off the square just as abruptly a few weeks later, prompting some in political circles to joke that the venerated sage, who hailed from rural Shandong, had been busted for not having a Beijing residence permit.

For centuries political satire has been a staple for much of Chinese humor, and remains so during the Communist era.

In the 1980s, when the first signs of official corruption related to economic reform began appearing, humorists cleverly minted ditties like these:

"I'm a big official, so I eat and drink, eat and drink..."