Two studies examined young children's early understanding and evaluation of truth telling and lying and the role that factuality plays in their judgments. Study 1 (one hundred four 2- to 5-year-olds) found that even the youngest children reliably accepted true statements and rejected false statements and that older children's ability to label true and false (T/F) statements as "truth" and "lie" emerged in tandem with their positive evaluation of true statements and "truth" and their negative evaluation of false statements and "lie." The findings suggest that children's early preference for factuality develops into a conception of "truth" and "lie" that is linked both to factuality and moral evaluation. Study 2 (one hundred twenty-eight 3- to 5-year-olds) revealed that whereas young children exhibited good understanding of the association of T/F statements with "truth," "lie," "mistake," "right," and "wrong," they showed little awareness of assumptions about speaker knowledge underlying "lie" and "mistake." The results further support the primacy of factuality in children's early understanding and evaluation of truth and lies.