SUSAN PIERCE: The latest challenge on "Project Runway" was to create a dress made of newspaper, paying homage to the iconic paper dress first designed in 1968.

Now, of course, this is fascinating to Lisa and me! Who knew we had a potential fashion boutique sitting on pallets down on the company's first floor?

LISA DENTON: It was remarkable how the designers crafted wearable outfits out of newspaper. There are a bazillion uses for this stuff, but typically nothing so glamorous. I was amazed at the ingenuity the designers showed. They were given dyes and markers, but the best designs were inspired by the printed page. Photos and fonts subbed for color and texture.

SUSAN: The designs were remarkable, but they didn't amaze me as much as Johnny Sakalis' outright fabrication of truth as to what happened to his original design.

After Tim Gunn told Johnny that it looked like a "craft project," the designer balled up the strange origami-inspired sheath and shot it into the wastebasket.

But when asked about his dress, he concocted this fictional tale about ruining it with a steam iron.

The other designers should have shouted, "You lie!"

Dude, never make up a whopper when there are cameras rolling!

LISA: Yep, that was the biggest fabrication of the night. I kept trying to give him the benefit of the doubt, thinking maybe the sputtering steam iron was the reason it looked like it did, and they just hadn't shown it on camera.

But he stuck with that lame story, even after it was clear he was making it up. Why not say, "Tim hated the first one, so I trashed it?" It wouldn't be the first time that's happened on the show.

It was very telling at the end when Tim came in and delivered his usual line, "I have to ask you to gather your things." There was no goodbye hug, no "we'll miss you." It was more of an unspoken "Don't let the door hit you ..." And as soon as Johnny left the room, Tim erupted about his ridiculous lie.

SUSAN: As for the winning design, by Irina Shabayeva, I thought it showed a thoughtful, clever play of texture.

But my favorite was Christopher Straub's strapless "ballgown" with innumerable layers of shredded paper made to look like feathers. I can only imagine how difficult that was, because I know when I'm stressed here at work and shredding strips of paper, my end result never looks like feathers.

LISA: I could appreciate Irina's trenchcoat, but with bunny slippers instead of boots, it just as easily could have been a bathrobe with that ruffled collar and sleeves.

My favorite was Althea Harper's dress. The way she folded the pages gave it a subtle fan effect and sophisticated sheen.