Why AI 'Hallucinates': OpenAI Reveals Surprising Cause

New research from OpenAI explains why language models generate false information and what's being done about it.

OpenAI's latest research paper explains that AI models 'hallucinate'—confidently generating false information—because current training methods reward guessing over admitting uncertainty. This surprising finding suggests a fundamental issue with how AI performance is evaluated, pushing models to prioritize accuracy metrics even when unsure. Efforts are underway to reduce these occurrences.

Katie Rowan

By Katie Rowan

September 5, 2025

4 min read

Why AI 'Hallucinates': OpenAI Reveals Surprising Cause

Key Facts

  • AI 'hallucinates' because standard training and evaluation reward guessing over admitting uncertainty.
  • Hallucinations are plausible but false statements generated by language models.
  • A chatbot confidently produced three different incorrect answers for Adam Tauman Kalai's dissertation title and birthday.
  • Current evaluation methods, like accuracy scores, incentivize guessing rather than saying 'I don’t know.'
  • GPT-5 has significantly fewer hallucinations, especially when reasoning, but they still occur.

Why You Care

Ever asked an AI a question, only for it to confidently give you a completely wrong answer? It’s not just you. This phenomenon, known as ‘hallucination’ in AI, is a persistent challenge. OpenAI, a leader in artificial intelligence, has just shed light on why this happens. Understanding this helps you better interact with AI and recognize its limitations.

What Actually Happened

OpenAI has released new research explaining why language models sometimes ‘hallucinate.’ This means the AI confidently generates information that isn’t actually true. According to the announcement, the core issue lies in how these models are trained and evaluated. Standard procedures, the research shows, reward guessing rather than acknowledging uncertainty. Even models like ChatGPT hallucinate, although GPT-5 has significantly fewer instances, especially when reasoning, the company reports.

Hallucinations are plausible but false statements generated by language models. For example, when asked for the PhD dissertation title of Adam Tauman Kalai, a co-author of the paper, a widely used chatbot produced three different incorrect answers. Similarly, when asked for his birthday, it gave three different wrong dates, as detailed in the blog post. This highlights how easily models can invent information.

Why This Matters to You

This research matters because it changes how we think about AI accuracy. Current evaluation methods, the study finds, inadvertently encourage models to guess. Imagine a multiple-choice test. If you don’t know an answer, guessing might get you lucky, but leaving it blank guarantees zero points. Similarly, models graded solely on accuracy are encouraged to guess instead of saying, “I don’t know.” This can lead to misleading information being presented as fact by your AI tools.

“Most scoreboards prioritize and rank models based on accuracy, but errors are worse than abstentions,” the paper states. This means a confident wrong answer is more problematic than the AI admitting it lacks information. OpenAI’s internal Model Spec, for instance, emphasizes indicating uncertainty or asking for clarification over providing incorrect information. How often do you check the facts an AI gives you?

Consider this: if a language model doesn’t know someone’s birthday, it might guess ‘September 10.’ This gives it a 1-in-365 chance of being right. Saying ‘I don’t know’ guarantees zero points on a test. Over thousands of questions, the ‘guessing’ model appears to perform better on scoreboards. This incentivizes less honest, more speculative responses from the AI you use daily.

Here’s a breakdown of response categories:

  • Accurate Responses: The model provides correct information.
  • Errors: The model confidently provides incorrect information.
  • Abstentions: The model admits uncertainty or doesn’t hazard a guess.

The Surprising Finding

Here’s the twist: hallucinations persist because current evaluation methods set the wrong incentives. It’s not that the models are inherently trying to deceive. Instead, the team revealed, they are simply ‘teaching to the test.’ This means AI models are trained to maximize their score on evaluations, even if it means guessing when uncertain. This challenges the common assumption that more data or more complex models alone will eliminate hallucinations.

For example, the research shows that if a model guesses a birthday, it has a 1-in-365 chance of being right. However, saying “I don’t know” guarantees zero points on an accuracy-based test. This makes the guessing model look better on scoreboards, even if it’s producing more confident errors. The paper argues that errors are worse than abstentions, highlighting a fundamental flaw in current AI evaluation. This finding is surprising because many assume AI is always striving for factual correctness, when in reality, it’s often optimizing for a specific metric.

What Happens Next

OpenAI is actively working to reduce AI hallucinations. GPT-5, for example, already shows significant improvements in this area, especially with complex reasoning tasks. This suggests a shift in training methodologies is already underway. We can expect further reductions in hallucination rates over the next 12-18 months as these new evaluation methods are implemented. For instance, future AI models might be explicitly rewarded for admitting uncertainty, leading to more reliable outputs.

For you, this means future AI interactions could become more trustworthy. Instead of a confident but wrong answer, your AI might simply state, “I don’t have that information.” This makes AI a more honest and dependable tool. The industry as a whole will likely adopt similar evaluation changes, pushing for greater ‘humility’ in AI responses. As mentioned in the release, humility is one of OpenAI’s core values, underscoring their commitment to more reliable AI systems. This ongoing effort aims to make AI systems more useful and reliable for everyone.

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