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Lesson 4 of 35

Lesson 4 · Understanding Modern AI

Why AI Sounds Right and Still Gets Things Wrong

Hallucinations are not random glitches. They follow predictable patterns that you can learn to spot. This article explains why fluent AI answers can be false, where errors cluster, and which habits reduce them, with an honest account of what no habit can fix.

On this page

Key takeaways

  • A hallucination is fluent output that is false, unsupported or invented. It is a normal failure mode of language models, not a rare malfunction.
  • Models produce plausible text, and training and evaluation have tended to reward guessing over admitting uncertainty, so confident wrong answers are common.
  • Errors cluster around exact numbers, citations, quotes, obscure facts, recent events and long chains of reasoning.
  • You can reduce errors by supplying sources, allowing "I don't know", asking for quotes and splitting tasks, but you cannot eliminate them.
  • Match your checking to the stakes, and never treat fluency, confidence or a tidy format as evidence of truth.

A student asks an assistant for "three research papers on sleep and exam performance, with authors and links". Within seconds comes a neat list: titles that sound right, authors with believable names, journals, years. The student pastes two into their reference list. The third gets a link check later, and the link goes nowhere. On a closer search, none of the three papers exists.

This is not a story about a bad tool. It is a story about a normal behaviour of language models, and about a person who did not know to expect it. Once you understand why it happens, you stop being surprised and start being careful in the right places.

What you will learn

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  • What counts as a hallucination, including less obvious kinds.
  • Why models produce them, in plain words.
  • Where errors are most likely, and a list of warning signs.
  • Habits that reduce errors, and the limits of those habits.
  • A task-fit table to help you decide when to rely on AI and when to check hard.

What a hallucination is

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A hallucination is output that reads as confident and fluent but is false, unsupported by the sources it should be based on, or invented. "Hallucination" is a slightly unfortunate word, because it suggests a rare breakdown. Many people prefer plainer descriptions such as "making things up" or "fabrication", and some research uses the broader word "confabulation". The label matters less than recognising the shapes it takes:

Kind

Example

Why it is hard to notice

Invented facts

A date, statistic or definition that is simply wrong

Delivered in the same tone as true facts

Invented sources

Papers, books, court cases, links or quotes that do not exist

They look exactly like real ones

Misreading your material

A summary that attributes a statement to the wrong person, or adds a claim the document does not make

You assume it read what you gave it

Stale information

An out-of-date rule or price presented as current

The model does not flag that its knowledge has a cutoff

Faulty reasoning

A tidy step-by-step argument with a wrong step

The structure looks rigorous

Calculation slips

A sum or percentage that is slightly off

Close enough to look right

Agreeing with you

Accepting a false premise in your question and building on it

It feels like confirmation

Why it happens, in plain words

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1. The model is built to continue text plausibly

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As article 3 explained, a language model chooses a likely next piece of text, over and over. A realistic-looking citation is a very likely continuation of "here are three papers on sleep and exams". The model has seen thousands of citation formats, so it can produce the shape of one fluently. Whether the specific paper exists is a different question, and nothing in plausibility-seeking requires the answer to be yes.

2. Guessing has often been rewarded more than admitting uncertainty

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A 2025 research paper by Kalai, Nachum, Vempala and Zhang, "Why Language Models Hallucinate", argues that hallucinations arise partly because training and evaluation procedures reward guessing over acknowledging uncertainty. Think of an exam with no penalty for wrong answers: a student who always guesses scores higher than a student who leaves blanks. If models are scored and tuned in a similar way, they learn that a confident guess beats "I'm not sure". The authors treat this as a feature of how systems are trained and measured, which suggests it can be improved by changing the incentives, but it does not mean any given model today has solved it.

3. Rare facts leave thin traces

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A model sees famous facts many times in training and obscure facts rarely or never. For something it has seen only a handful of times, or not at all, there may be nothing reliable to draw on, and yet the machinery still produces an answer.

4. The context may be missing, long or confusing

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If you have not given the model the document it needs, it may answer from general patterns. If you gave it a long document, parts may be overlooked. If your question contains an error or an assumption, the model often continues in that direction.

5. Preference tuning can favour pleasing answers

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Models are tuned to produce answers people rate highly, and people often rate agreeable, confident and complete answers highly. The side effect can be sycophancy: agreeing with a mistaken user, softening corrections, or not saying "I don't know".

6. Errors compound

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Because each piece builds on the last, an early mistake can drag a long answer in the wrong direction. Longer answers give more opportunities for a slip.

Where errors are most likely

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Learn this table; it tells you where to spend your checking effort.

Higher risk

Lower risk

Exact numbers, dates, prices, limits, percentages

Explaining a well-known concept at a basic level

Citations, DOIs, links, case names, quotes

Rewording or tightening your own text

Obscure people, small companies, local rules

Brainstorming where "wrong" is not a thing

Recent events and anything that changes over time

Summarising a short text that you can compare against

Laws, tax, medical and financial specifics

Formatting, restructuring and translating (spot-check)

Long multi-step reasoning or calculations

Generating practice questions on material you already know

Claims about a specific document that was not provided

Simple code patterns you can run and test

Notice that the lower-risk column is not "safe". It is "easier to check". The common thread is whether you can quickly tell if the output is wrong.

Warning signs

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None of these proves an error, but each justifies a closer look:

  • Very specific details with no source: exact figures, dates, page numbers, quotes.
  • Sources you cannot find with a quick search of the title or author.
  • Names or terms you do not recognise in an area you thought you knew.
  • Perfectly round or too-neat numbers.
  • No uncertainty anywhere, especially on questions where experts disagree.
  • The answer repeats your own assumption back to you as if confirmed.
  • A response that fits your hope too perfectly, such as the exact reference you were wishing existed.

What reduces errors, and what does not

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Official guidance from the model makers is consistent on this. Anthropic's documentation on reducing hallucinations suggests allowing the model to say "I don't know", asking it to extract word-for-word quotes from long documents before answering, and having it support each claim with a quote and retract claims it cannot support. It also suggests comparing several runs and restricting the model to the supplied documents instead of its general knowledge. And, importantly, it says these techniques reduce hallucinations but do not eliminate them, so critical information should still be validated.

Turning that into habits:

Habit

How to do it

Why it helps

Give the source

Paste the text and say "answer only from this"

Turns guessing into reading, and you can check it

Permit uncertainty

"If the text does not say, write 'not stated'"

Gives the model a safe option other than guessing

Ask for quotes

"Quote the sentence that supports each point"

Lets you verify in seconds

Split the task

Extract facts first, then analyse

Smaller steps are easier to check

Compare runs

Ask twice, or ask another way

Disagreement flags a weak spot

Use a retrieval tool, then check it

Prefer a product that shows links to sources, and open them

Citations help only if they are real and say what is claimed

Ask for the strongest objection

"What would a sceptic say is wrong with this answer?"

Counters the tendency to agree

And what does not work reliably:

  • "Do not hallucinate" as the only instruction. The model cannot reliably tell which of its outputs are invented. Instructions help most when they change the task, such as "use only this text".
  • Asking "Are you sure?" Some assistants will reverse a correct answer, and some will defend a wrong one. It is not a verification method.
  • Trusting a longer, more detailed answer. Detail is cheap for a language model.
  • Assuming a paid or newer product is immune. Better tools often err less. Not never.

A worked example: the invented reading list

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Goal. You need real sources on sleep and exam performance for an assignment.

Initial request.

Code
Give me five academic papers on sleep and exam performance with authors, year and DOI.

What may come back (an illustrative example, not real output):

Code
Example response (illustrative)1. Chen, L. and Rao, P. (2019). Sleep duration and academic outcomes in university students. Journal of Educational Health, 12(3), 45-58. doi:10.0000/example2. ...

What is wrong. Every element looks right, which is the problem. The request asked the model to recall specifics from memory, which is exactly where invented details appear. Any of these papers may be real, partly real, or entirely made up, and you cannot tell from the text.

Better approach. Change the task from recall to search guidance, and move the verification to a real database:

Code
I am writing a short literature note on sleep and exam performance inuniversity students. Do not give me any citations from memory. Instead:1. List 6 search phrases I could use in Google Scholar or my library database.2. Name 3 kinds of study design I should look for and what each can and   cannot show.3. Tell me what a trustworthy source looks like for this topic.

Verify. You run the searches yourself, open the actual papers, and note the citation details from the paper or database record, not from the assistant. If you later paste a real abstract into the assistant, you can ask it to summarise that text, and then check the summary against the abstract.

Result. You used the assistant for the part it handles well (search strategy and explanation), and avoided the part where it is unreliable (recalling bibliographic details).

Task-fit: when to rely, when to check hard

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This is the "Decide" step of the Work Loop in table form.

Situation

Suggested stance

You can easily judge the output yourself

Use freely, spot-check

You supplied the source and it is short

Use, and compare against the source

The output contains figures, names, citations or quotes

Check each one

The topic is health, law, tax, money, safety or hiring

Use AI only to prepare questions or understand terms, and rely on authoritative sources and qualified people

You cannot tell whether it is right

Do not use it for that purpose yet, or learn enough to judge

Common mistakes

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  • Assuming that hallucinations only happen on difficult questions. They also happen on simple-looking ones, such as "who wrote this paper".
  • Verifying one item and assuming the rest are fine. One correct citation tells you little about the others.
  • Using AI to verify AI. A second assistant can help flag issues, but it can repeat the same error. Your final check should rely on independent sources.
  • Believing a source exists because a link is present. Links can be invented or may not support the claim. Open them.
  • Feeling safe because the answer is "cautious". Hedged language can be just as wrong as confident language.

Exercises

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Exercise 1

Classify the error

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Name the kind of hallucination in each: (a) an assistant summarises your meeting notes and says "Anil agreed to the deadline" when the notes say he objected, (b) it cites a 2021 law as current when it was amended in 2024, (c) you ask "Since vitamin C cures colds, how much should I take?" and it gives a dose without questioning the premise.

Exercise 2: Risk rating

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Rate each as higher or lower risk for errors, and say why: (a) "Explain what a binary search is." (b) "What was the exact revenue of a small private company last year?" (c) "Rewrite this paragraph in simpler English."

Exercise 3: Rewrite the request

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Rewrite this request so that it reduces the chance of invented details: "What did the 2023 annual report of our company say about attrition?" Assume you have the report as text.

Exercise 4: Plan the check

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An assistant gives you a summary of a research article that says "the study of 500 students found a 30 percent improvement". Write the steps you would take before repeating this claim in a presentation.

Show solutionHide solution

(a) Misreading your material. The source was provided and the summary got it wrong. This is the case people forget, because they assume that providing the text guarantees accuracy. (b) Stale information. The knowledge is out of date, not invented. (c) Agreeing with you (accepting a false premise). A good answer would question the premise first.

Why classification helps: each kind has a different fix. Misreading is fixed by asking for quotes. Staleness is fixed by checking dates and current sources. Agreement is fixed by asking the model to challenge your assumption before answering.

Exercise 2

Show solutionHide solution

(a) Lower risk. It is a widely documented concept, and you can test the explanation with a small example. (b) Higher risk. It asks for an exact figure about a small, possibly obscure entity, where the model may have little or no reliable data and may produce a plausible number. Check the company's filing or a reputable source. (c) Lower risk. The text is yours and you can compare it with the original. Check that the meaning has not changed.

Remember that "lower risk" means "easier to check", not "no need to check".

Exercise 3

Show solutionHide solution

One good version:

Code
Below is the text of our 2023 annual report. Answer only from this text.Question: what does it say about employee attrition?For each statement in your answer, quote the sentence from the report thatsupports it. If the report does not mention attrition, say "not stated".[paste the report text]

Why it works: the source is in context (grounding), the model is told to stay inside it, each claim must carry a quote you can verify, and "not stated" gives a safe alternative to guessing. If the report is too long to paste, paste the relevant section, and say so.

Exercise 4

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A sound plan:

  1. Find the original article and read the abstract and methods yourself. Do not rely on the summary.
  2. Check that the study really had about 500 participants and what group they were.
  3. Find what the "30 percent improvement" measured: on what outcome, compared with what, over what time period, and whether the difference was statistically meaningful.
  4. Check whether it was a single study, an experiment or an observational study, and what the authors say about limits.
  5. Note the exact citation from the article itself.
  6. Phrase your own claim to match what the study can support, for example "In one study of about 500 students, researchers reported X under conditions Y", not "this proves 30 percent improvement".

Why: a number lifted from a summary loses its context, and the context decides whether the claim is fair. This is the habit the fact-checking article builds out.

Where to go next

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Sources & further reading

  1. arxiv.org
  2. platform.claude.com
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