"Fiction is the truth inside the lie." ~ Stephen King
Fiction is made up. Does that mean it's just a bunch of lies? Well, let's see, the definition of a lie is to intentionally mislead. While writers sometimes exaggerate to make a point come across stronger, their purpose of writing fiction is most often to point out significant truths about life and the human existence. Yes, we fiction writers make up all sorts of stuff: characters, events, worlds and whatever else we want - and we have great fun doing it. For most of us it's about telling truths as we perceive them. Fiction can actually be a very honest art form.
That isn't to say, however, that all fiction contains the truth. I suppose it's possible that some writers might actually want to mislead by means of fiction, although I can't imagine there are many. Also, not everyone in this world shares the same truths or perceptions of things. You might not agree with an author's truth, but that still doesn't make it a lie. It's just another view of things. If an author is really good, he can make a reader who has an opposing viewpoint stop and at least consider things from his point of view.