This article analyzes the phenomenon of false news circulating in theWarsaw ghetto in the critical period of the first months of 1942. At that time, members of the underground and ordinary people learned about the mass extermination of Jews in other towns and provinces of German-occupied Poland. The first part of the article discusses production of false news as a response tomarket demand for optimistic “breaking news” that strengthened the hope for the imminent end of war. The second part focuses on the political context and identifies political stakes and actors behind the production of false news. The article demonstrates that responding to market demand and political use and abuse of false news are not mutually exclusive but can reinforce one another. It also shows that dependence on false, optimistic news could not only make people psychologically resilient but also more vulnerable since it made them susceptible to political manipulation.