Apparently author James Frey is dealing with that question.
In a story first appearing on theSmokingGun.com, and now picked up by other media outlets, doubts were raised as to the veracity of some of the events Frey recounted in his best-selling memoir, "A Million Little Pieces." Frey's book, the TODAY show on NBC reported, was the second best-selling book in 2005, just after "Harry Potter and the Half-Blood Prince." It was also one of Oprah's Book Club selections.
What the TSG investigation and other probes like in USAToday say is that Frey may have wildly embellished what happened to him.
So the question is, if it's Frey's life story, what room is there for, shall we say, improving on the details to make a better story? Certainly, as in Frey's case, having a melee with cops after getting arrested is more thrilling and captivating than going quietly, which is what the arresting officer says happened.
I would propose that line is where the non-fiction is no longer true, that the story has been so improved upon that it didn't really happen. For example, if I were talking about my early adventures in journalism, I might recount a tale about interviewing the FBI and CIA agents in my hometown. Does it matter if the chair in the CIA agent's office was cracked red plastic or cracked black plastic, or wasn't plastic at all? Probably not. What would matter would be if I claimed that the CIA agent gave me a great news tip about the big case going on and I scooped the local paper. That wasn't the way of it at all.
Creative non-fiction is about presenting true events in a creative way, using the techniques of fiction -- plot, dialogue, foreshadowing. It's not about writing fiction and passing it off as true.