I would say that it's a defense mechanism--and a reflection on the way he gets treated at home or elsewhere when he's caught doing "wrong" (not that at his age there's much that's truly "wrong", iykwim).

A 2 year old is not capable of purposefully concealing the truth--but they are capable of telling what they wish had happened, or what they know the adult wants to hear, or, in these cases, what they know will NOT get them in trouble. "Truth" is a fluid concept for them, and it will be until early elementary school.

As for doing things only when he thinks you're not looking--I'd say that's pretty normal. Mine has done it all along! But again, I think it probably reflects a lot on how he gets treated at home.

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