From Snopes...

"AP regional photo editor Tom Stathis said he took extensive steps to confirm the one-eyed cat was not a hoax. Stathis had Allen ship him the memory card that was in her camera. On the card were a number of pictures — including holiday snapshots, and four pictures of a one-eyed kitten. The kitten pictures showed the animal from different perspectives.

Fabricating those images in sequence and in the camera's original picture format, from the varying perspectives, would have been virtually impossible, Stathis said."

It is real, they have pictures of a cyclopic goat as well.