[APA.org] This research paper looked at patients with different sites of brain damage, and studied their ability to understand sarcasm. The authors conclude that sarcasm is a function of the right frontal lobe. Patients with lesions in the frontal lobe and the right brain were unable to understand simple irony and sarcasm.

http://www.apa.org/journals/releases/neu193288.pdf

Neuropsychology. 2005 May;19(3):288-300.

The neuroanatomical basis of understanding sarcasm and its relationship to social cognition. Shamay-Tsoory SG, Tomer R, Aharon-Peretz J. Cognitive Neurology Unit, Rambam Medical Center, Haifa, Israel. shamay@psy.haifa.ac.il.

PMID: 15910115

See also:

http://www.ncbi.nlm.nih.gov/entrez/...300&query_hl=11

PMID: 15781300