"I know what you're thinking: do it yourself, right?"
I usually root for the underdog: colon. I don't think you should use nested single quotation marks. Unlikely that the speaker knows the exact words the listener is thinking. It's like an indirect quotation: "She said she would be here," vs. "She said, 'I'll be here.'" It's more like, "I know you're thinking you should do it yourself," than, "I know you're thinking, 'Do it yourself.'"
EDIT: It depends on the meaning. Who should do it himself? If the listener should do it, then no nested quotation marks. If the speaker should do it, then quotation marks are required, because without, 'yourself' can't refer to the person speaking.