The Finnish rock band Juice Leskinen Slam performed their song "Mies joka rakastaa itseään" in almost in its entirety in the film. The initial long take was achieved with a Jonathon Jib arm mounted on a slightly modified Elemack Spyder Dolly (both then owned by Suomi-Filmi). Director Mika Kaurismäki and Juice Leskinen didn't really know each other before the film, but eventually formed a lifelong friendship. Leskinen also originally suggested The Saimaa Gesture (1981) to Kaurismäki.
Aki Kaurismäki and Pauli Pentti worked on the first version of the script in the summer of 1979 with Veikko Aaltonen (who was meant to direct it), but it was left unfinished at the time. Mika Kaurismäki already had another idea for his first feature film (a road movie, which became Arvottomat (1982), also featuring Aki's character Ville Alfa), but saw in Valehtelija (1981) an opportunity to do his thesis film in Finland.
The full name of the main character, Ville Alfa, is only said once in the film. Actor Aki Kaurismäki says it himself at the grocery store's checkout. The first name Ville is said five more times (and once in a written form in the end credits), always by someone else. "Villealfa Filmproductions" was the production company owned by Aki and Mika Kaurismäki, formed a few months after the film's release in 1981. The company's first film was The Saimaa Gesture (1981).
Director Mika Kaurismäki's graduation film from the Hochschule für Fernsehen und Film (HFF) in Munich (then West Germany). Cinematographer Toni Sulzbeck studied in the same, publicly funded film school. The script was translated to German, but the film was never dubbed to any language.
Some scenes were shot in the Linnanmäki amusement park in Helsinki. The Mermaid hall (Finnish: Vedenneidot) was permanently closed shortly after filming in 1980, mainly due to complaints from the feminist groups.