The Internet of Battlefield Things (IoBT) refers to interconnected battlefield equipment/sources for synchronized automated decision making. Due to difficulties unique to the battlefield, such as a lack of infrastructure, the heterogeneity of equipment, and attacks, IoBT networks differ significantly from regular IoT networks. In war scenarios, real-time location information gathering is critical for combat effectiveness and is dependent on network connectivity and information sharing in the presence of an enemy. To maintain connectivity and guarantee the safety of soldiers/equipment, location information must be exchanged. The location, identification, and trajectory of soldiers/devices are all contained in these messages. A malicious attacker may utilize this information to build a complete trajectory of a target node and track it. This paper proposes a location privacy-preserving scheme in IoBT networks using deception-based techniques. Dummy identifier (DID), sensitive areas location privacy enhancement, and silence period concepts are used to minimize the attacker’s ability to track a target node. In addition, to consider the security of the location information, another security layer is proposed, which generates a pseudonym location for the source node to use instead of its real location when sending messages in the network. We develop a Matlab simulation to evaluate our scheme in terms of average anonymity and probability of linkability of the source node. The results show that the proposed method improves the anonymity of the source node. It reduces the attacker’s ability to link the old DID of the source node with its new DID. Finally, the results show further privacy enhancement by applying the sensitive area concept, which is important for IoBT networks.