I'd say it's not okay to lie, but embellishment is encouraged.
For example, I hire programmers. If you put on your resume you know some language or framework, I'm probably going to test you on it. If you can't code hello world, or something basic I'm going to pissed off.
Now, if your role was technically something like a jr java engineer but you put on there that you were a mid level, meh I'm not going to check. As long as your skills are roughly in line I'll let you through to the next round.