The present research investigated the generation of memory illusions. In particular, it attempted to delineate the conditions under which category-based thinking prompts the elicitation of false memories. Noting fundamental differences in the manner in which expected and unexpected person-related information is processed and represented in the mind, it was anticipated that, via gist-based recognition, participants would display a pronounced propensity to generate expectancy-consistent false memories. The results of three experiments supported this prediction. In addition, the research revealed that participants' false memories were accompanied by the subjective experience of knowing (Expt. 2) and that false recognition was exacerbated under conditions of executive dysfunction (Expt. 3). We consider the theoretical implications of these findings for recent treatments of memory illusions and social cognition.