Not that Wikipedia is always the best source, but I think this definition matches what most people believe:
A white lie is a lie which is believed harmless or innocuous, or in is accordance with the conventions of the culture. A common example of a white lie is, "You look marvelous."
The same article quotes linguist George Lakoff in his criticism of claims prior to the Iraq War:
Are they lies—or are they merely exaggerations, misleading statements, mistakes, rhetorical excesses and so on? Linguists study such matters. The most startling finding is that, in considering whether a statement is a lie, the least important consideration for most people is whether it is true! The more important considerations are, Did he believe it? Did he intend to deceive? Was he trying to gain some advantage or to harm someone else? Is it a serious matter, or a trivial one? Is it "just" a matter of political rhetoric? Most people will grant that, even if the statement happened to be false, if he believed it, wasn't trying to deceive, and was not trying to gain advantage or harm any one, then there was no lie. If it was a lie in the service of a good cause, then it was a white lie. If it was based on faulty information, then it was an honest mistake. If it was just there for emphasis, then it was an exaggeration. Lakoff (2004) p. 76.
With these fresh reminders, let's review:
A white lie is one you tell in "service of a good cause," or that is "harmless" or "innocuous" according to cultural norms. In other words, a lie told to benefit others - avoiding hurt feelings, advancing the common good, or making someone else feel good in a harmless way.
If the deception is not for the benefit of others, it's just a plain, flat-out lie. If you lie to protect yourself, you are not "telling white lies." You are just lying.
When you tell someone else that you intend to do something that you have no intention of doing, but you pretend that you do because you don't want the other person to realize what a cretin you are, then you are lying. Not fibbing, not telling white lies, not exaggerating. Lying.
If a friend looks absolutely hideous in some avant-garde space-age Janet-Jackson-at-the-Super-Bowl piece of mylar that she intends to wear to a wedding, and you tell her that she looks good, you are lying. What you said was certainly not for her benefit, exposing her to certain ridicule for wearing such an inappropriate outfit. It was only for your benefit so she wouldn't think of you as the "bad guy," because you're the one who doesn't have the stones to tell your friends the truth.
People think that if they lie so that other people will like them or want them around, that it's just a white lie. It's not. It makes no difference if it's telling a powerful person what you think he wants to hear so you can benefit from knowing him, or if it's just lying about the fact that you were the one who purchased your kinky sex toy (and that it wasn't a "gift" from someone that no one's ever seen) because you don't want people to know you'd spend money on such things. It's speaking falsehoods to benefit yourself. It's a plain old lie, and those who tell them every day out of fear of not fitting in have basic and fundamental character problems.
