Being a rhetorical approach, exaggeration is widely used in languages. Exaggeration has a connection with exterior conditions such as context, language style and so on. It also has a close relationship with psychological factors such as association, imagination, emotion and so on. Being a rhetorical phenomenon, exag-geration has its own psychological mechanism. Based on the achievements of its predecessor, this paper discusses the psychological mechanism of exaggeration from the aspects of the construction of exaggeration and the accep-tance of exaggeration.