This overview discusses the nature of perceptual illusions with particular reference to the theory that illusions represent the operation of a sensory code for which there is no meaningful ground truth against which the illusory percepts can be compared, and therefore there are no illusions as such. This view corresponds to the Bayesian theory that “illusions” reflect unusual aspects of the core strategies of adapting to the natural world, again implying that illusions are simply an information processing characteristic. Instead, it is argued that a more meaningful approach to the field that we call illusions is the Ebbinghaus approach of comparing the illusory percept with a ground truth that is directly verifiable as aberrant by the observer in the domain of the illusory phenomenology (as opposed to relying on the authority of other experts). This concept of direct verifiability not only provides an operational definition of “illusion”; it also makes their interactive observation more effective and informative as to the perceptual processes underlying the illusory appearance. An expanded version of Gregory’s categorization of types of illusion is developed, and a range of classic and more recent illusions that illustrate the differences between these philosophical viewpoints is considered in detail. Such cases make it clear that the discrepancies from the measurable image structure cannot be simply regarded as idiosyncrasies of sensory coding, but are categorical exemplars of perceptual illusions. The widespread existence of such illusory percepts is indicative of the evolutionary limits of adaptive sensory coding.