AI system design interview: detect and reduce hallucination in production

Interview questionLast reviewed Oct 16, 2026By Himanshu Ramchandani
Short answer

Diagnose before fixing: read traces of the reported answers and classify each one as missing knowledge, bad retrieval, unfaithful generation or fabricated specifics. Fix retrieval first when the right passage wasn't there, require citations and answer-from-context instructions, move exact values to tools, add an abstention path tested with unanswerable questions, and verify claims against sources for high-risk answers. Then track the unsupported claim rate on sampled production answers every week.

Question

Users report confident wrong answers. What do you do?

Clarify

  • Which feature and which users.
  • Whether the system uses retrieval or answers from the model alone.
  • How costly a wrong answer is: a product FAQ vs legal or medical advice.

Diagnose by type

Type What the trace shows Fix
Missing knowledge No relevant document exists Add content, or abstain
Bad retrieval The right passage exists but wasn't retrieved Hybrid search, chunking, reranking
Unfaithful generation The right passage was retrieved and the answer contradicts it Prompting, smaller context, verification
Fabricated specifics Numbers, names or dates not in any source Values from tools, citation checks

Fixes in order

1 - Read 30 to 50 failing traces and count the types, so you fix the largest group first. 2 - Fix retrieval if the right passage was missing. 3 - Require citations and instruct the model to answer only from context. 4 - Move exact values (prices, dates, balances) to tools. 5 - Add an abstention path and test it with unanswerable questions. 6 - For high-risk answers, verify each claim against the sources before responding.

Monitor

Sample production answers weekly, check claims against sources (with an LLM judge you've validated against expert labels), and track the unsupported claim rate as a metric with an owner.

What interviewers listen for

Diagnosis by type before fixes, and a metric you'd track.

From the floor

In the citation verifier session, I explained the problem with an AI search tool pulling information from websites: the answer comes with citations, but nobody can easily verify that the cited source says what the answer claims, and in legal work an unverified citation can lead to a penalty from the judge, which is why verification is a step of its own, not something you trust the model to do.

Sources