My dad is remembering things that never happened. Is this a sign of dementia?

My dad would tell things that wasn't true. I was sitting a bit behind him and he was talking to our pastor. As he told something the pastor would shift his eyes to me and I would shake my head or nod to let him know if it was true or not.

Also, dad was aging fast in his own mind. He told a friend before a church service he was 127. After the service we asked him again and he said he was 163. He was 82 when he passed away but about 10 days earlier insisted he was 273 years old. We just laughed and let it go.

It could be some form of dementia. Confabulations are stories made up in the mind of someone with cognitive impairment. From what I know of it, they can be a mixture of things that happened with things they've heard elsewhere like movies etc. They are very real to the one experiencing them. Sudden changes like you describe need to be addressed by a doctor as many medical conditions and even some medications can cause such things.