keyup strange problem!!!!!

keyup strange problem!!!!!

HTML CODE:
    <div id="header"></div>
   <form>
        <input id="target" type="text"  />
        <input id="target2" type="text"  />
  </form>

JQUERY CODE(Test 1):
  $(function(){
        $('#target').keyup(function() {
               $('#target2').attr("value",function(){
              return $('#target').val() ;});
                    });
                });
JQUERY CODE(Test 2):
$(function(){
  $('#target').keyup(function() {
        $('#header').html("<h1>"+function(){
        return $('#target').val() ;}+"</h1>");
                   });
                  });

The Test 1 is working fine as expected but the test2 function is not executing and the header becomes "function(){return $('#target').val() ;}"...Whts the reason?
and is there any other way to do it fast?The text in target2 is a 1/2 letter behind target1.
Please help