append values with both single and double quotes to textbox

This is because you are concatenating strings, which doesn't take escaping of special characters into account. You should instead set the value with .val so that the value is escaped properly. Also, the regex is unnecessary.

$(document).ready(function(){
    var test= "this is vicky\"s \"s 's 's \"s \"S";

    alert(test);

    var input = $("<input style='width:700px;' id='testbox'></input>").val(test);

    $("#test").html("hey this is ").append(input);

});

See updated test case on jsFiddle

So to solve this problem without using .find or appending the var seperately, I found a simple solution for this. I just need to replace the single quote " ' " with its iso latin code ' and other special characters with their respective codes and then use that variable in .html

var something= "this is vicky\"s \"s 's 's \"s \"S";
test=something.replace(/'/g,"'").replace(/"/g,'\\"');
$("#test").html("hey this is <input id='testbox' value='"+test+"'></input>");

Have a look at this jsfiddle