Method One. Tell a short anecdote which may either be true or be a complete fabrication. Have the group ask you questions about it. Give additional information as necessary to generate more questions. Then ask the students to decide whether you were telling the truth or making the whole thing up—lying, that is. Put it to a vote. Method Two. A variation is to bring in a picture (which the students cannot see) and describe it to the class.
Again, the description may be true or it may be completely false. Let the group quiz you about the details. As with Method One, the students must decide whether you are telling the truth or lying.
To follow up, ask a student to tell a story or describe a picture in the same way. Again, the remainder of the class must decide whether the student is telling the truth or lying. As an optional extra with either method, you may wish to ask students to explain why they voted as they did. This can be done individually, student by student, or by a panel of three or four students. Encourage the students to give contextual reasons for their verdicts rather than make comments such as "(S)he always lies / exaggerates."