In Toni Morrison's novel, Beloved, the use of magical realism is evident in the way that Morrison combines elements of fantasy and reality, leaving it up to the reader to decide how to compartmentalize those literary devices within the plot.
The changes in physical appareance in some of the characters are the most noticeable forms of magical realism. Suggs, for instance, is said to have such a sadness and emptiness inside her soul that "her eyes did not pick up a glitter of light". Here we see how Suggs appears to have eyes that are supernaturally dark. Are they, really or is this a product of literary license?
Another example comes in the seemingly premonitory dreams of Suggs, and in Beloved's exaggerated craving for sweets which makes her body so massive that she looks as a creature rather than a person. The glow about Beloved, the impression it causes around them, and the effects of each character on one another give the reader the impression of something outer-wordily taking place. These are the basic ideas behind magical realism.
I think that the most potent way in which Morrison's work can represent magical realism would be with the presence of the title character. Sethe's murder of her child has revisited her in the flesh with the new visitor. The idea of questioning what defines elements such as death is something that is a part of magical realism, a movement which seeks to weave the present tense of this world with the supernatural to create a new conception of time as it is known. Beloved would certainly fit this criteria. Another example in which Morrison's work appropriates the idea of magical realism would lie in its questioning of progress and what defines it. Sethe might represent a conception of progress, but with Beloved's presence, she is forced to go back in time and essentially ask herself if she has progressed. Has she made peace with what happened, and with what she did? Beloved's presence forces her to reevaluate her own life, moving it from a black and white conception to one where the multiple shades of color present themselves, dissonant and fair all in one. In this reassessment of identity, magical realism can be seen.