Oblivious Younger Sibling

Relative, family member, or longtime friend of a character who is "blind" to their actions.

If this is a heroic character or someone designed to impress, the sibling—especially if they're older—is hypercritical and only think of them as the doofy kid who wet the bed till they were 10. Conversely, a lame character will be liked for their hidden good qualities due to their close and protective relationship with the sibling. In this case, there's major overlap with being a Fan of Underdog.

They might act as a Morality Pet, but in extreme cases this can drive a one-sided dependency on him.

Sometimes it's a fan instead of an actual sibling, and a chain is made where The Hero is a fan of a more famous hero, and the fan of The Hero sees them the same way but won't acknowledge The Hero acts like a dork most of the time.

Examples of Oblivious Younger Sibling include:

Anime and Manga

In Love Hina, Kanako's fond memories of her stepbrother, Keitaro, makes her somewhat oblivious to his failures. But maybe sympathy, among other things clouds her judgement.
S-Cry-ed has the reverse situation, where Kanami seems oblivious to Kazuma's powerful Alter abilities and sees him as a kind-hearted layabout. It's later shown that Kazuma intentionally acts uncharacteristically pathetic around Kanami to encourage her to be more independent, apparently so that she'll have an easier time coping if the male half of their two-member family were to die violently.
Yuzu in Bleach is similarly oblivious to her brother's powerful abilities and the supernatural activities and entities that surround them. This is most likely due to her faint spiritual awareness, especially in comparison to her sister Karin, who knows all about what Ichigo is and does.
Both of Chitose's "adopted" sisters in Happy Lesson frequently handwave their brother's grouchy outbursts.
Subverted in Ichigo Mashimaro: Chika has no illusions about her elder sister Nobue. Still, the trope applies, as Nobue is the Cool Big Sis to all four girls regardless.
Likewise subverted in Airmaster, where Maki's little sister, unlike everyone else, describes her as a huge clumsy ogre who gets stupider each time they meet.
Inverted in Kamichu!. Shoukichi is the only one that seems to realize just how weird everything is, including the cat's possession.
Mokuba Kaiba (Yu-Gi-Oh!) is absolutely devoted to his older brother, Seto. Indeed, he is the only regular character who calls Seto by his first name.
- Though he's not exactly oblivious in either the manga or anime.
Shuuichi, the little stepbrother of Kurama in Yu Yu Hakusho, is completely oblivious to his brother's demonic heritage and supernatural activities.
Pop Harukaze from Ojamajo Doremi
Carole Amherst, in Mutant Ninja Turtles Gaiden, thinks that her brother's funeral was staged and he's now become an actor who plays the role of a mutant turtle studying with fellow actor Raphael. If you think that's oblivious, read chapter six of the comic.
Partially subverted in Sekirei where the younger sibling is also a part of the plan, but doesn't know of her brothers involvement in it.
Inverted and subverted in Deadman Wonderland; Yoh, the apparently oblivious older sibling, reveals he's known about his little sister Minatsuki's Cute and Psycho tendencies all along, but wants to protect her anyway.
In One Piece, the older brother Ace is horrified and angry when Luffy goes to Impel Down to rescue him because he believes that Luffy's just being the typical reckless, idiotic younger brother that he remembers that always made him worry.
- In an interesting inversion, Luffy himself at first doesn't want to go to rescue his big brother after discovering his life is in danger via his burning Vivre Card and explains that his older brother is strong and wouldn't appreciate being rescued. It's only when he discovers that Ace is on death row that he decides to go rescue his brother.
Nunnally in Code Geass missed that whole bit about her brother being The Strategist for La Résistance during all those times when he was cutting class. Justified, since he goes out of his way to hide it from her.
- Although, the fact that she is very good at recognising voices (being blind) yet does not recognise Zero's voice as her brother's despite the digital distortion being very slight does make her fairly oblivious.
Eve from Baccano! is completely convinced that her big brother Dallas is a good person, despite increasing evidence otherwise.

Film

Parodied in Johnny Dangerously when at one point the Pope (Dom DeLuise) reminds all the neighborhood residents that Johnny's Mom and Brother think he's just a nightclub owner and not the notorious gangster Johnny Dangerously, and to keep the secret from them.
Reuben of Little Odessa knew about his brother's shady dealings, but apparently managed to put it out of his mind for most of the time and still looked up to him.

Live-Action TV

Lyle Bennet on Heroes was pretty good about this for a while. Then he found out and ran away from the discovery. Then he got over it and became somewhat competent.
In Noob, one of the titular guild's members has a younger brother who is also playing the MMORPG and has reached a higher level than his. He doesn't notice for quite a while despite the fact that they sometimes take turns on the same computer.
Gioffre of The Borgias doesn't seem to take any notice of the corrupt political world the rest of his family are embroiled in.

Western Animation

Subverted with Gaz on Invader Zim: she is perfectly aware that her older brother Dib is trying to thwart an alien invasion, she just doesn't care.