To represent something as being larger, greater, better, or worse than it really is. She tends to exaggerate her achievements to make herself seem more impressive.
To enlarge or increase to an abnormal degree. The artist exaggerated the features of the face to create a caricature.
To speak or write in an overstated way; to make exaggerated statements, often without specific reference to what is being overstated. It's hard to tell whether he's joking or just exaggerating.