Two child groups (5-6 and 8-9 years of age) participated in a challenging rule-following task while they were (a) told that they were in the presence of a watchful invisible person ("Princess Alice"), (b) observed by a real adult, or (c) unsupervised. Children were covertly videotaped performing the task in the experimenter's absence. Older children had an easier time at following the rules but engaged in equal levels of purposeful cheating as the younger children. Importantly, children's expressed belief in the invisible person significantly determined their cheating latency, and this was true even after controlling for individual differences in temperament. When "skeptical" children were omitted from the analysis, the inhibitory effects of being told about Princess Alice were equivalent to having a real adult present. Furthermore, skeptical children cheated only after having first behaviorally disconfirmed the "presence" of Princess Alice. The findings suggest that children's belief in a watchful invisible person tends to deter cheating.