The Lake Wobegon effect, named for the fictional town where all children are above average, is well documented in surveys about education. Respondents tend to rate their local public schools higher in quality than schools overall in the state or nation, even despite contrary evidence. One potential explanation for this disconnect is a psychological construct known as “illusory superiority.” While the superiority aspect of illusory superiority is well studied, the illusory nature of these attitudes typically is assumed rather than empirically demonstrated. Further, the predictors of these attitudes also merit exploration. We seek to address both of these points. We hypothesize that illusory superiority in the context of attitudes toward public education may be driven in part by self-interest, and thus may be more likely to be found among those with the biggest stake in local schools, such as parents of students, homeowners, and longtime residents. Using survey data from Massachusetts, we find a factual basis for illusory superiority by comparing perceptions of local school performance on standardized tests to actual scores. We also model predictors of illusory superiority, including property ownership, length of residency, and having children enrolled in public schools, and the role that illusory superiority may play in school ratings. We then assess the effects of overstatement of test scores on attitudes toward a key educational issue – whether to increase taxes to provide additional funding for local schools.