This study investigated the development of moral judgments of blue lies, which occur when a speaker makes false statements to benefit a group of which he or she is a member. We investigated this issue in China, where there is substantial emphasis on the nature of children's associations with groups they belong to. Participants ranged in age from 9 to 17, and we asked them to evaluate lies that were told to benefit a team representing a speaker's class, school, or country. Judgments varied systematically as a function of age, with the 17‐year‐olds rating lying for any form of collective less negatively than did the younger age groups. In addition, across the age groups, children's affinity tended to shift from smaller groups to broader and more abstract collectives: 9‐ and 11‐year olds were least critical of blue lies told to benefit a speaker's class, 13‐year olds were least critical of blue lies told to benefit a speaker's school, and 17‐year olds were least critical of blue lies told to benefit a speaker's country. Copyright © 2015 John Wiley & Sons, Ltd.