This is a favorite, much-kicked-around topic of mine, and earlier this week the good folks at The Rumpus added a fresh contribution to the debate.
Messing With Memoir is an essay about the author’s efforts to revise her out-of-print memoir, years after she’d written it, and the ethical issues she grappled with in doing so. Here’s a taste:
I was a much better writer now. Why let that raw, earnest, adverb-friendly, long-sentenced version of myself linger? With e-books and Print on Demand (POD) as a garrote, I could quietly, efficiently off her. In her place I would seat that wiser, more skilled self.
But was it ethical? I had never heard of anyone tampering with their memoir. A memoir is not only an account of your life, it is specifically an account of your remembrances of your life. So now I would be telling that same story fifteen years later. I was re-remembering a memory.
Even more important, a memoir is a reflection of who you are at the time of writing. But now I would be peering backwards at myself from a new vantage point. Isn’t there a different author (older, wiser me) now? And haven’t I now changed my main character by writing her with this new hand? Did this matter?
Touching on the same theme in one of his “Daily Rumpus” emails a few days back, editor Stephen Elliott wrote about “the only true rule of memoir”:
You cannot knowingly tell a lie. In other words, you can be wrong, you can write things you consider to be true that other people consider to be untrue. In fact, it’s impossible to do otherwise. Most truth is not factual; most truth is subjective. But to state a something as fact when you know it is not, ie. I spent this much time in jail, is to break the cardinal rule.
I think that gets it about right.
Eva Holland 
Elliott is quite right. Memoir and autobiography, though formally nonfiction, are literature. That is to say: they are art. And as art the product ought be creative and interesting to read, and that a thing actually happened is no sufficient justification for including it in your narrative.
You should never lie, if for no other reasons than that lies can be found out and a seductive lie may mislead even you. If a fact no longer fits your intended narrative, it is plainly unnecessary to your story and you owe a duty to your reader not to burden them with it. A crucial skill in art is knowing what to omit. Without that skill, a Michelangelo sculpture is just a block of marble from the quarry and the finest tale is just a bunch of things that happened.
Take responsibility for your own story by deciding what is important and what is just something that happened. Your judgment of this will unsurprisingly change over time. Your task as author is not merely to collect facts and lay them out for your reader to make sense of, but to select and marshal those facts in order to tell the truth that you believe is behind them. Your readers expect no less.