Organisms use signals of quality to communicate information about aspects of their relative phenotypic and genetic constitution. Badges of status are a subset of signals of quality that reveal information about an individual's size and dominance. In general, signals of quality require high and differential costs to remain honest (that is, prevent low-quality cheaters from exploiting any fitness benefits associated with communicating high quality). The theoretically required costs for badges of status remain controversial because the development (or `production') of such signals often seems to be relatively cost-free. One important hypothesis is that such signals impose social (or `maintenance') costs incurred through repeated agonistic interactions with other individuals. However, convincing empirical evidence for social costs remains elusive. Here we report social costs in a previously undescribed badge of status: the highly variable black facial patterns of female paper wasps, Polistes dominulus. Facial patterns strongly predict body size and social dominance. Moreover, in staged contests between pairs of unfamiliar wasps, subordinate wasps with experimentally altered facial features (`cheaters') received considerably more aggression from the dominant than did sham controls, indicating that facial patterns are signals and that dishonest signalling imposes social costs.