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Wireless sensor networks (WSNs) have been proliferating due to their wide applications in both military and commercial use. However, one critical challenge to WSNs implementation is source location privacy. In this paper, we propose a novel tree-based diversionary routing scheme for preserving source location privacy using hide and seek strategy to create diversionary or decoy routes along the path to the sink from the real source, where the end of each diversionary route is a decoy (fake source node), which periodically emits fake events. Meanwhile, the proposed scheme is able to maximize the network lifetime of WSNs. The main idea is that the lifetime of WSNs depends on the nodes with high energy consumption or hotspot, and then the proposed scheme minimizes energy consumption in hotspot and creates redundancy diversionary routes in nonhotspot regions with abundant energy. Hence, it achieves not only privacy preservation, but also network lifetime maximization. Furthermore, we systematically analyze the energy consumption in WSNs, and provide guidance on the number of diversionary routes, which can be created in different regions away from the sink. In addition, we identify a novel attack against phantom routing, which is widely used for source location privacy preservation, namely, direction-oriented attack. We also perform a comprehensive analysis on how the direction-oriented attack can be defeated by the proposed scheme. Theoretical and experimental results show that our scheme is very effective to improve the privacy protection while maximizing the network lifetime.