Functional MRI (fMRI)-based lie detection has been marketed as a tool for enhancing personnel selection, strengthening national security and protecting personal reputations, and at least three US courts have been asked to admit the results of lie detection scans as evidence during trials. How well does fMRI-based lie detection perform, and how should the courts, and society more generally, respond? Here, we address various questions — some of which are based on a meta-analysis of published studies — concerning the scientific state of the art in fMRI-based lie detection and its legal status, and discuss broader ethical and societal implications. We close with three general policy recommendations.