Though it is frequently condemned, lie-telling is a common and frequent activity in interpersonal interactions, with apparent social risks and benefits. The current review examines the development of deception among children. It is argued that early lying is normative, reflecting children's emerging cognitive and social development. Children lie to preserve self-interests as well as for the benefit of others. With age, children learn about the social norms that promote honesty while encouraging occasional prosocial lie-telling. Yet, lying can become a problem behavior with frequent or inappropriate use over time. Chronic lie-telling of any sort risks social consequences, such as the loss of credibility and damage to relationships. By middle childhood, chronic reliance on lying may be related to poor development of conscience, weak self-regulatory control, and antisocial behavior, and it could be indicative of maladjustment and put the individual in conflict with the environment. The goal of the current chapter is to capture the complexity of lying and build a preliminary understanding of how children's social experiences with their environments, their own dispositions, and their developing cognitive maturity interact, over time, to predict their lying behavior and, for some, their chronic and problem lying. Implications for fostering honesty in young children are discussed.