Jem and Scout already realize that Dill tends to exaggerate a bit when he tells of his life in Meridian, Mississippi. They're never sure which stories are true and which are not. In Chapter 5, while the children are trying to figure yet another way for Boo Radley to come out into the open, Dill mentions that he believes Boo must have a big, long beard. Scout coyly responds, "Like your daddy's?" Dill answers that his father doesn't have a beard, but then realizes that he may have earlier told Jem and Scout a different story before.
"Uh huh, caughtcha," I said. "You said 'fore you were off the train good your daddy had a black beard--"
Scout had caught him in a lie, but Dill simply explained that his daddy had shaved it off the previous summer.
In Harper Lee's To Kill a Mockingbird, Scout catches Dill lying about his father having a beard.
Dill is talking about how Boo must have a very long beard having been inside the house for so long. Scout mentions Dill's father's beard, and Dill replies that he doesn't have a beard. Scout reminds him of his story of his father with a beard, and though Dill makes excuses, Scout knows he telling "tall tales" (lies). She expects that the mounted police uniform he has spoken of will never show up either.
Dill Harris could tell the biggest ones I ever heard.
Scout then lists some of Dill's other lies. Dill says he's flown in a mail plane seventeen times, had traveled to Nova Scotia, had seen an elephant, and that his father was Brigadier General Joe Wheeler, who allegedly left Dill a sword. Dill doesn't have the home life that Scout and Jem do, and this may simply be his way of feeling more important rather than an outsider at home. Scout realizes that Dill tells stories, but doesn't seem to resent him for it.