Much like romantic paintings of this same era, the setting and plot of "The Devil and Tom Walker" are rich with color and beset with the supernatural.
Romantic painters often included mystical beings such as cherubs and angels in their work, particularly since the era was still largely influenced by Christianity in its various denominations. Along with this belief in heavenly hosts came a belief in Satan (the devil), who is referred to in this work as "the dark woodman" or "Old Scratch." It was not uncommon for people of this era to believe that one could strike deals with the devil in a Faustian fashion, but the other portion of that belief always stated that the price paid by those who did such dealings was entirely too great -- meaning one had to sacrifice one's soul in order to receive the promised benefits from Satan himself.
In addition to the plot, the setting is a key to this story's dark romanticism. Our protagonist, Tom, meets the devil when he goes into "the woods," always a place of danger and evil in any symbolic literature (Hansel and Gretel, Mythology, etc.). The woods represent a straying from the true path of life, and when one strays, he/she becomes prone to the influence of evil, represented here by Old Scratch. Romantic literature frequently uses wilderness to foreshadow evil or wrongdoing, and this story is no different.
Dark Romanticism is a form of literature that uses the mysterious and dark settings characteristic of Romanticism as a whole in ways that are often threatening and scary. Dark Romantic settings are Gothic in nature--that is, they involve the use of horror and are threatening in nature. Dark Romanticism also seeks to expose the darkness or sins inherent in all humans.
"The Devil and Tom Walker" contains elements of Dark Romanticism, as the setting of the story is a threatening place described as "a thickly wooded swamp, or morass" where the devil himself reigns. The setting is gloomy and isolated, and there Tom Walker lives in isolation, as "no traveler stopped at its door." Instead, Tom's house is steeped in darkness and mystery, and the swamp nearby ruled by the darkness of nature:
"The swamp was...a retreat for all the owls of the neighborhood. It was full of pits and quagmires, partly covered with weeds and mosses; where the green surface often betrayed the traveler into a gulf of black smothering mud."
As is true in Gothic and Romantic stories, the swamp where Tom Walker lives is overrun by nature and its irrational ways, and civilization and its order do not reach this place. Instead, this is where Tom meets the devil. In this swamp, evil and heathenism reign supreme. The devil says, "I am he to whom the red men devoted this spot, and now and then roasted a white man by way of sweet smelling sacrifice." The devil subscribes to heathen ideas, and heathenism rules in the swamp.
Like Dark Romantic tales, the story exposes the greed inherent in man. Tom Walker agrees to do the devil's bidding in exchange for a great sum of money that originally belonged to Kidd, a pirate. Tom becomes a money lender charging great sums in interest until he is also taken by the devil. The story exposes the sin and darkness in humans, and it is rumored that Tom still haunts the swamp after he perishes. He becomes a ghost, a fixture of Gothic literature, at the end of the story.