At some point in your career, you will probably come across a boss that you don't agree with. Sometimes it may even escalate to the point where you openly disagree with him. No boss is perfect, but you would like to believe that in his heart of hearts he has your best interest in mind. "He's just trying to motivate me," you might say. However, the line is crossed when lying and manipulation become staples of the routine. You need to report and expose such instances.
Assess your own behaviour, and be honest with yourself. Before you can take action, you need to make sure that you yourself aren't giving the other side any ammo. Make sure that you refrain from cloak-and-dagger gossiping or venomous complaints. For now, hard as it may be, do everything that is asked of you, as it will bolster your credibility and only help your case in the end.
Track specific incidents where your boss lied or manipulated you. Speaking of ammo, you'll need some yourself. The more skilled your toxic supervisor is at the spin, the more concrete information you will need. Otherwise your case against him could be whitewashed, you could look bad and he could remain in power. Also, remember to stay positive and willing to work during this step. But don't oversell it, as you may inadvertently arouse his suspicions.
Enlist the help of your coworkers. You must be cautious during this step, however. Things could backfire if the person you talk to is loyal to your boss without your knowledge. But if you choose the right person, your case will be that much stronger. The more people saying the same negative things about your boss --- everybody with documentation, of course --- the more likely that those in charge will take your case seriously.
Familiarise yourself with your boss's reputation amongst his supervisors. Is he a known malcontent who is begrudgingly kept around because he meets his numbers and deadlines without fail? Or is he a master of smoke and mirrors who has his supervisors believing that he is the perfect guy for the position? Before you blow the whistle, it would behove you to learn whether he is lauded or merely tolerated. This will help you gauge how well you will be listened to and how big your burden of proof is.
Contact the proper authorities within your company. Each company has a different method and chain of command; know whom to go to with your evidence. In some cases where the boss is the owner, you might contact the Better Business Bureau. Whomever you contact, you need to come across as what you are: someone who simply wants to be treated fairly in the workplace. That may sound obvious, but the key thing not to do is seem vindictive. If the powers that be sense that you have an axe to grind, your case may crumble, and you're back to the drawing board.