Why is my preschooler lying?

Three-year-old Joey comes home from school and pulls two match box cars out of his pocket with great pride, ready to play.

His mother says, "Joey where did you get the cars?"
Joey says, "They're mine."
Mother says, "No, you took them from school."
Joey says, "They're mine."
Mother begins to get upset and disturbed.

Oh NO, my little Joey is lying to me, he stole them from school. I don’t want my child to lie and steal…a lying and stealing child is a horrible label!

Rest assured, this is not the case.
Joey is in the process of developing a healthy conscience and three-year-olds will test the realities of life. 

At three, Joey is in the process of leaving the “mine” stage of being a two-year-old and becoming more socialized for group play. Maybe he never had the opportunity to play with the cars at school because others were playing with them.

Joey is beginning to learn how to own things. A typical three-year-old's reality is - if it is in his hand, it belongs to him. That is three year old logic…car in my hand - my hand, my car!

Three-year-olds are learning how to bridge and integrate their emotional world with the intellectual world, in order to have a successful social world experience with their peers. This is a major milestone and hard work for a three-year-old.

So how do I handle it?

One way is...

• First, stay away from making judgments about the situation; realize Joey is only testing the social rules. This is normal. 
• Understand, it is not lying or stealing from the same perspective as we see it through the adult lens. 
• Stay calm and help Joey understand that you believe him, know that the cars are his when he is playing with them but when he is finished, they get put back on the shelf and they become the school's.
  "Let’s put them in a special plastic bag where you can still see them and we will ask your teacher which shelf to return them to at school. We can make a sign for it and attach it to the bag for the teacher."