When we believe misinformation, we have succumbed to an illusion: our perception or interpretation of the world does not match reality. We often trust misinformation for reasons that are unrelated to an objective, critical interpretation of the available data: Key facts go unnoticed or unreported. Overwhelming information prevents the formulation of alternative explanations. Statements become more believable every time they are repeated. Events are reframed or given “spin” to mislead audiences. In magic shows, illusionists apply similar techniques to convince spectators that false and even seemingly impossible events have happened. Yet, many magicians are “honest liars,” asking audiences to suspend their disbelief only during the performance, for the sole purpose of entertainment. Magic misdirection has been studied in the lab for over a century. Psychological research has sought to understand magic from a scientific perspective and to apply the tools of magic to the understanding of cognitive and perceptual processes. More recently, neuroscientific investigations have also explored the relationship between magic illusions and their underlying brain mechanisms. We propose that the insights gained from such studies can be applied to understanding the prevalence and success of misinformation. Here, we review some of the common factors in how people experience magic during a performance and are subject to misinformation in their daily lives. Considering these factors will be important in reducing misinformation and encouraging critical thinking in society.