To “pull the wool” over someone’s eyes means to deceive or hoodwink them.
The usual source given for this expression is the wearing of woollen wigs, which were popular with both men and women in the 1500s and 1600s. However, the phrase itself originated in America in the 1800s. The earliest example of it in print appears to be in the Gettysburg newspaper The People’s Press, November 1835: “We are glad to find among the leading Van-ites, at least one man, whose conscience will not permit him to ‘go the whole hog’ in pulling the wool over the people’s eyes.”
But it seems doubtful that the “wig” derivation is correct, since the wearing of wigs had largely died out in the US by the early 1800s. The tradition has continued in Europe where the judiciary of several countries wear wigs in court.
In the US, however, the third president, Thomas Jefferson (1801 – 1809), although a wig wearer himself, advised the judiciary there: “For Heaven’s sake discard the monstrous wig which makes the English judges look like rats peeping through bunches of oakum.” It is apparently true that many wigs were ill-fitting and so could slip over the wearer’s eyes, momentarily blinding them.
It has been suggested that its origin came from a clever lawyer fooling a judge, and thus “pulling the wool over his eyes.” This boast from lawyers became common usage to describe a deception performed by a clever individual. A less likely explanation is that pickpockets tipped the wigs of victims forward, then grabbed their purses while they were momentarily distracted.
Frances M. Whitcher wrote, in The Widow Bedott Papers (1856), “He ain’t so big a fool as to have the wool drawn over his eyes in that way.”
So we don’t really know where the phrase originated. If it had been here in Canada, I’d suggest that it came from a winter’s afternoon of street hockey, where one kid pulled another’s toque down over his face so he couldn’t see where the puck was going.