Did Itachi Really Say “People Live Their Lives Bound by What They Accept as Correct and True”?

Yes, with a catch about the words. Itachi Uchiha does deliver this speech to Sasuke during their final fight, and the idea in it is exactly as circulated. But "people live their lives bound by what they accept as correct and true, that's how they define reality" is not the official English. It is a fan translation that got there first and never left.

The verdict

Real, but the translations differ. The scene is the brothers' last battle, with Sasuke trapped inside Itachi's genjutsu and Itachi narrating what an illusion is; fans file it under Shippuden episode 138 and the manga's Tsukuyomi chapter. In the official English, the one printed in Viz's volumes and spoken in the dub, the line runs: "Each of us lives dependent and bound by our individual knowledge and our awareness. All that is what we call reality. However, both knowledge and awareness are equivocal. One's reality might be another's illusion." Both CBR and Screen Rant print that wording. The version in the memes, with "correct and true" and "merely vague concepts" and "their reality may all be a mirage," is a scanlation of the same Japanese, made while the chapter was new and shared for years before the licensed text caught up.

Why two versions exist

The Japanese underneath is dense and abstract, the kind of sentence that gives a translator three defensible options for every noun. The scanlators rendered it in plain conversational English, which is why it reads well on a poster. Viz went for something closer to philosophical register, "equivocal" and "awareness," which is why it reads like the man who says it. Neither is wrong. What is wrong is treating the meme wording as the canonical line, because a reader who checks the volume will not find it, and will conclude, incorrectly, that the whole thing is invented. It is not. It is the case where a real line has two English lives.

What the speech is doing

Context makes the official wording the better one. Itachi is not offering Sasuke a life philosophy; he is explaining a technique while using it. Genjutsu works because reality is whatever your senses agree to, and he is inside Sasuke's senses as he speaks. The scanlation makes the line sound like a wise man's motto about belief. Viz's "one's reality might be another's illusion" is a sentence about what he is about to do to his brother's mind. The whole speech is a threat disguised as a lecture, which is the most Itachi thing about it, and the motto version loses that.

Why the scanlation won

Timing. The chapter came out years before the licensed English volume, and by then thousands of readers had already memorised the fan version and put it on images. Official translations almost never overtake a scanlation that has become a quote, because the quote sites copy each other rather than the book. The same thing happened to Gojo's "nah, I'd win", which is a fan rendering of a line Viz translated differently, and it is common enough across this database that it has its own verdict category.

What to quote

If you want the line as the English-language release actually has it, use the Viz wording. If you want the one people recognise, use the scanlation but do not call it a quotation from the manga, because it is not one. Itachi's other lines on this site, on the Naruto hub, all carry their sources; his catalogue on Wikiquote is thin, which is one reason the fan version has had so little competition.

How we checked

The verification process looks for the line in a primary or editorial source. Wikiquote's Shippuden page does not carry the speech in either wording; CBR's ranked list of Itachi's lines and a Screen Rant feature on the same speech both print the official English, and neither prints the meme version. That is what a translation split looks like from the outside: the licensed text is in the editorial record and the popular text is only in the aggregators. It sits in the fact-check database as real, with the wording caveat that keeps a reader from calling it fake when they open the book.