Verbal deception may be considered morally reprehensible or acceptable depending on culturally relevant contextual factors and ethical perspectives. In the current study, Euro-Canadian (n = 180) and Han Chinese (n = 180) children ages 8 to 16 were recruited to investigate their moral evaluations of lying and truth-telling in competitive situations. The participants classified a story character’s statement told to either harm or help themselves or collectives of various group sizes (i.e., their class, school, or country) as a lie, the truth, or something else. Participants then made moral judgments regarding the statements and provided justifications for their evaluations. Chinese children’s evaluations became more nuanced with age: They evaluated lies told to benefit a collective as less negative than Canadian children, and truths told to harm a collective as more negative. These evaluations became more pronounced with the increasing size of the collectivity. Cultural and contextual factors relevant to evaluations and justifications of verbal deception are discussed.