An untrue and unbelievable story.
Tall stories are pieces of verbal exaggeration or boastfulness which may be intended to deceive or may be openly bogus and merely intended to amuse. The name was coined in the 19th century in England, where the stories were also called Munchausens, after Karl Friedrich Hieronymus, Baron von Münchhausen. He might sound fictional, but was in fact a real person, albeit a purveyor of extravagantly untruthful stories about himself.
In the USA, the openly bogus 'around the campfire' stories are known as 'tall tales' and, under that name, have become a distinct and stylised form of storytelling, becoming ever more embellished as they are retold. Tall tales usually involve a larger-than-life mythical character who accomplishes some superhuman task; for example Paul Bunyan, the giant lumberjack who could fell a tree with a single swing of his axe.
'Tall stories', 'tall tales' and other variants, like 'tall talk' and 'tall writing', were in use in the 19th century. Examples of these are:
- Routledge's Every Boy's Annual, 1869: "Tall stories - What the Yankees call 'tall talk'."
- The playground of Europe, Sir Leslie Stephen, 1871: "Tall talk is luckily an object of suspicion to Englishmen."
Our usual understanding of 'tall' is that of the OED's unambiguous definition - "of more than average length when measured from bottom to top", and seems like an odd choice of adjective for a fanciful story. The word had been used with another meaning since the early 1600s, i.e. 'lofty; grand'. That meaning of 'tall' was used especially with regard to high-flown and flowery language. John Eachard made use of the term in The Grounds & Occasions of the Contempt of the Clergy, 1670:
"Others there be, whose parts stand not so much towards tall words and lofty notions, but consist of scattering up and down, and besprinkling all their sermons with plenty of Greek and Latin."
'Tall talk' was in direct contrast with 'small-talk'. That term, meaning 'light conversation or chit-chat', was introduced in the 18th century. 'Tall talk' was what men indulged in amongst themselves and 'small-talk' when women were present. An early example of that comes in the 4th Earl of Chesterfield's Letters, 1761:
"A sort of chit-chat, or small-talk, which is the general run of conversation in most mixed companies."