So you think you might be dating a pathological liar? No, you're not. He's just a big jerk.
The popular stereotype of a pathological liar-- a chronic liar, deceiver, who lies to get out of things, or into things; who tries to con you into something, or control you; who cheats on you and then denies it, makes up stories about where he was-- all this is wrong. It's malingering, but it isn't pathological lying. He's a tool, but he's not psychiatric.
"Pathological lying" is often interchanged with "pseudologia fantastica." (NB: many psychiatrists use pseudologia fantastica interchangably with confabulation-- this is also wrong, as will be described below.) Pathological lying was originally defined as complex lies which are internally consistent, that may drag on for years and-- and this is the key point-- do not have an obvious purpose or gain. They're not trying to con you into or out of anything. They're just making crap up.
The lies are unplanned, spontaneous. Once told, they generally stick (for years)-- but it's fair to say the pathological liar doesn't know what he's going to say until he says it. He is a bullshit artist who makes it up as he goes along, and who then semi-believes his own crap.
And the lies aren't even useful lies. You ask him what he did last Saturday and he tells you he went to the museum; and maybe he says at the museum he saw a guy try to rob the gift shop, but he got caught by two off duty cops wearing blue hats. And later you learn he was really at a movie with his girlfriend and you think, why the hell did this freak make all that up?
That's why it's called pathological.
A pathological liar is like a 4 year old kid, who tells you what happened to him down by the lake. Meanwhile, there's no lake.
The important question here is this: does the pathological liar know he is lying? Or does he believe his stories? Is he lying, or is he delusional?
The answer is: both. Sort of.
He is not delusional, but he hovers in that half-world of the narcissist (oh, there's that tie-in), where the lies are believed until he gets caught, but then-- and this is the move that only a few can pull off-- he acknowledges that the "facts" are lies, but not the essence, the spirit. "Ok, look, I'm not really in the CIA." But in his mind, he knows that if conditions were right-- if something big went down-- he could be exactly like a CIA agent, and that's close enough. If he saw a suicide bomber, he'd be able to movie- kung fu him, grab the Sig Sauer and squeeze off a few rounds. He also knows which wire to clip. How does he know? Because he's in the CIA.
If aliens actually did come and attack us, he knows he would actually be able to fly a spaceship.
Pathological lying is not "confabulation." In both cases, lies are told spontaneously and freely, without clear intent, purpose, or gain-- except that in confabulation, the reason the person lies is to fill in the deficits in his memory; he can't remember what actually happened. Hence confabulation is associated with dementia ("when I was 18 I went to Paris with my unit and I saw... 8 puppies get eaten by Chamberlain and de Gaulle-- hand to God I saw it"), and especially with alcoholic dementia/hallucinosis ("I don't know what happened to me-- six guys jumped me... yeah... six... Canadian guys, I think they were Satanists, no, wait, Stalinists, yeah, that's right, and they could read my mind...")
What about biological correlates? There aren't any, because this isn't a disease, it's a description. Here's an example: an article entitled, "Prefrontal white matter in pathological liars" found massively (20%+) increased prefrontal white matter, and a 40% decrease grey/white matter ratio in pathological liars, as compared to both controls and antisocials. But before you crack an anatomy book to figure out what that means (more prefrontal white matter= more ability to think and reason), you should know that the subjects they labeled "pathological liars" were really people who purposely and frequently lie to get a gain-- in other words, they were big fat evil scumbag liars, but not pathological liars. What this study found was that people who frequently lie develop a better brain for manipulating information, remembering stories, etc-- which is interesting, but not all that surprising.
My take is that pathological lying is a disorder of identity; the person imagines for himself an separate identity, and then fantasizes experiences and events which may be otherwise ordinary and predictable-- he went to the museum-- but in his mind happen only to "that" person. The lies hold the clues to that identity, but they may not be obvious. For example, maybe the part of the lie that's important isn't that he saw a guy rob the gift shop and get arrested, but that he was at the museum by himself-- the point is that he imagines himself a loner, or an artsy type, etc. Or maybe he's sees himself living in a world where crimes happen frequently. And maybe he thinks he's a superhero.
The pathological liar doesn't place much value in experience; it's all in identification. He doesn't need to be in the military to know exactly what it's like, because he's watched enough war movies (e.g. one) or read Tom Clancy. (Aside: that's the huge appeal of Clancy and Crichton-- enough detail to make you think you know the inner workings of the professions they describe.) It's wrong to dismiss the lies as valueless; like Zelig, these people do have an intuitive grasp of the relevant thought process, emotions, affects, and even consequences of the experiences they describe. They're just made up. So when he gets caught in his lie, he secretly blames the other person for not appreciating that whether it's a lie or not is trivial, irrelevant; it still affected him just the same.
(It would be interesting to study whether (true) pathological liars are able to provide a better "profile" of criminals, heads of state, etc, than professional profilers, and what supplementary factors might improve the accuracy of the profile. ("Here are some videos/documents on Vladimir Putin. Tell us what you think. Then, go out to dinner with this beautiful blonde ex-FSB agent and see if you come up with any further insights.") I suspect also that pathological liars would more predictably pass the new fMRI lie detectors; these detect binary lies ("are you this or are you not this?") but pathological liars hold contradictory truths simultaneously and thus may not register as deceptive. (P.S. I think I know how the test procedure can be altered to pick this up; but I also think I know how these tests can be reliably beaten. If anyone wants to study this, let me know.))