We studied whether magnetoencephalography (MEG) could detect deceptive responses on a single-subject, trial-by-trial basis. To elicit spontaneous, ecologically valid deception, we developed a paradigm in which subjects in a simulated customs setting were presented with a series of pictures of items which might be in their baggage, and for each item, they decided whether to ‘declare’ (tell the truth) or ‘smuggle’ (lie). Telling the truth involved a small but certain monetary penalty, whereas lying involved both greater monetary risk and greater potential reward. Most subjects showed decreased signal power in the 8–12 Hz (alpha) range during deceptive responses as compared to truthful responses. In a cross-validation analysis, we were able to use alpha power to classify truthful and deceptive responses on a trial-by-trial basis, with significantly greater predictive accuracy than that achieved using simultaneously recorded skin conductance signals. Average predictive accuracy for spontaneous deception was greater than 78%, and for some subjects, predictive accuracy exceeded 90%. Our results raise the possibility that alpha power modulation during deception may reflect risk management and/or cognitive control.