Be a good listener. No matter how outlandish her tall tales are, be receptive so that your child is comfortable communicating with you. If she says she saw a dragon, for example, say, "Wow! Tell me more." Look for the truth. Children sometimes make up stories to deal with something that's bothering them. For instance, a child may say, "The teacher pushed Johnny," when she may have only put an unruly classmate in time-out. Ask questions to get clues about what really happened. Set a good example. Kids often learn by watching their parents in action. If you've told "little white lies" in front of your child, she will learn that lying is okay when it's convenient. Most important, show your interest in what she has to say, not only to nurture her creativity but also to help build her self-esteem. Eventually, your child will be better able to distinguish fact from fiction.