H. G. Wells: War of the Worlds. Cover by Frank. R. Paul.
The blog Dark Dorset has an excellent retrospective (here) on H. G. Wells to commemorate the anniversary of his death on August 13, 1946. Known as the 'father of science fiction,' Wells's influence on authors like Lovecraft and Edgar Rice Burroughs is well known. Perhaps the best rendition of his famous 1897 story about a Martians invasion, War of the Worlds, is Orson Welles's 1938 Mercury Theatre On the Air radio production, which you can listen to here (part 1, further parts play automatically on youtube). You can read H. G. Wells's original story here and the Mercury broadcast script here. There is a resource site on the story and its adaptations here.
This production was so realistic that it caused mass panic in the United States. Many people fled their homes and police switchboards were swamped with inquiries. Wiki quotes Richard Hand: "some six million heard the CBS broadcast; 1.7 million believed it to be true, and 1.2 million were 'genuinely frightened.'" Wiki: "Many listeners were apparently confused. It must be noted that the confusion cannot be credited entirely to naïveté. Though many of the actors' voices should have been recognizable from other radio shows, nothing like The War of the Worlds broadcast had been attempted in the United States, so listeners were accustomed to accepting newsflashes as reliable. The problem is that the working script had only three statements concerning the fictional nature of the program: at the beginning, at 40 minutes, and at the end. In fact, the warning at the 40-minute mark is the only one after the actors start speaking in character, and before Welles breaks character at the end."
New York Times headline: "Radio Listeners in Panic." October 31, 1938.
Welles had to apologize. Of course the power of the production stemmed from H. G. Wells's powerful descriptions of growing disaster that were embedded in the radio script.
Orson Welles's apology, October 31, 1938.
I have not confirmed this, but I recall reading that legislation was subsequently passed so that dramatizations of fictional disasters always must have a repeated tagline indicating that they are fictional. The obligatory confirmation that a real-seeming drama is fictional was cleverly used in the opening of 1999's Blair Witch Project, which initially claimed to be a true story: "I'm just telling a scary story - but it's not true." The character Heather replies: "It's not true." The reverse psychology initially made the audience think that the story was true. We can trace this 100-year history of the blurring between truth and fiction, starting with H. G. Wells.