[The] distrust of everyday "reality"—it is characteristic that [Hesse] customarily bracketed the term with quotation marks to indicate what he regarded as its tentative, problematic nature—remained a conspicuous theme in Hesse's thought throughout his life. (p. vii)

At the same time, Hesse inevitably coupled his rejection of present "reality" with an assertion of his faith in a higher truth…. In 1940 his denial of "so-called reality" concluded with the claim that "all spiritual reality, all truth, all beauty, all longing for these things, appears today to be more essential than ever."

This perceived dichotomy between contemporary "reality" and eternal values produces the tension that is characteristic of Hesse's entire literary oeuvre. The heroes of his best-known novels … are men driven by their longing for a higher reality that they have glimpsed in their dreams, their visions, their epiphanies, but tied by history and destiny to a "reality" that they cannot escape. At times, however, Hesse sought to depict that other world outright, and not simply as the vision of a figure otherwise rooted in this world.

Northrop Frye has observed that "fantasy is the normal technique for fiction writers who do not believe in the permanence or continuity of the society they belong to." Accordingly, fantasy is the appropriate generic term for Hesse's attempts—both in his fiction and … in his painting—to render the world of which his fictional surrogates can only dream. In his classic essay "On Fairy-Stories" …, Tolkien defined fantasy as "the making or glimpsing of Other-worlds," and many of Hesse's works display precisely the "arresting strangeness," the "freedom from the domination of observed fact," that Tolkien has elsewhere called the essential qualities of fantasy. But fantasy, as the tension between an unsatisfactory "reality" and an ideal reality suggests, is more than the creation of other-worlds per se. A more precise definition might specify that fantasy is a literary genre whose effect is an ethical insight stemming from the contemplation of an other-world governed by supernatural laws.

By far the most common form of fantasy practiced by Hesse was the fairy tale or, to use the somewhat broader German term, the Märchen. Symptomatically, his earliest extant prose composition was a fairy tale entitled "The Two Brothers" (included [in Pictor's Metamorphoses and Other Fantasies] in the piece called "Christmas with Two Children's Stories" [one tale written by the ten-year-old Hesse and one tale written by his grandson]). (pp. viii-ix)

When he compared his early story "The Two Brothers" with a similar tale written some sixty years later by his grandson, Hesse observed that in both cases a wish is magically fulfilled, and in both cases the narrator has constructed for his hero a role of moral glory, a "crown of virtue." In short, both tales are characterized by elements of the supernatural (magical wish fulfillment) and by an explicit ethical dimension. (p. xii)

In every case,… from the fairy tale of the ten-year-old Hesse to the ironic fable of the sixty-year-old, the narratives that Hesse specifically labeled as Märchen display two characteristics that distinguish them from his other prose narratives. There is an element of magic that is taken for granted: wish fulfillment, metamorphosis, animation of natural objects, and the like. And this magic incident produces in the hero a new dimension of ethical awareness: the necessity of love in life, the inappropriateness of ambition, and so forth. To be sure, wonders and miracles occur in other forms of fantasy employed by Hesse: but elsewhere the miracle is regarded as an interruption or suspension of normal laws. In the legends, for instance, the miracle represents an intervention by some higher power (e.g., "The Merman" or "Three Lindens") that underscores the special nature of the occurrence. The figures in the fairy tales, in contrast, accept the wonders as self-evident: they do not represent any intrusion of the supernatural into the rational world, because the entire world of the Märchen operates according to supernatural laws. Little Red Riding Hood takes it for granted that the wolf can talk; the wicked stepmother in "Snow White" consults her magic mirror just as routinely as a modern woman might switch on her television set; and the tailor's son is not astonished at a table that sets itself with a feast when the proper formula is uttered. Hesse's Märchen share this quality of self-evident magic. Pictor [in the title story] does not question the powers of the magic stone; the aspiring young artist [in "Tale of the Wicker Chair"] is not astonished when the wicker chair talks back to him.

However, a world in which magic is taken for granted does not in itself suffice to make a fairy tale: it must also be a world with an explicit ethical dimension…. As Bruno Bettelheim points out in The Uses of Enchantment, "the child can find meaning through fairy tales," which offer an experience in moral education through which he brings order into the turmoil of his feelings. This is precisely the message of Hesse's Märchen: the characters are brought to an awareness of some principle of meaning that they had previously misunderstood. (pp. xiv-xv)

The impulse toward fantasy remained powerful in Hesse's temperament throughout his life. (p. xvi)

[As an outlet for his fantasy], Hesse chose a form consistent with his current realism—the legend, a genre in which the supernatural was not entirely implausible because it could be attributed to the mythic consciousness that existed in remote times and places…. As we noted, however, the supernatural occurrences in the legends are regarded as an interruption of normal "reality" and not, as in the fairy tales, as self-evident. But Hesse soon found other ways of dealing with fantasy.

Dreams always played a lively role in Hesse's psychic life, as he tells us in the late essay "Nocturnal Games." The ominous precognitive dream of war related in "The Dream of the Gods" … is significant because it signaled the unleashing of the powers of fantasy that Hesse had sought for more than a decade to suppress. During World War I, a variety of pressures … produced in Hesse an emotional crisis so severe that, in 1916 and 1917, he sought help in psychoanalysis. It was Jungian analysis, with its emphasis on dreams and their interpretation, that enabled Hesse to recover the childlike contact with the world of fantasy that he had attempted so long to repress…. [Several] of the fairy tales that he wrote during the war are barely disguised metaphors for the recovery of the past through psychoanalysis…. (pp. xvii-xviii)

Hesse was fully aware of the significance of the wartime Märchen and dreams in his personal development. In August of 1919 he wrote his publisher that Demian along with the Märchen that he composed from 1913 to 1918 were "tentative efforts toward a liberation, which I now regard as virtually complete." By means of the fairy tale, he had succeeded in reestablishing the link with the unconscious that had been ruptured…. However, the tone begins to change from the high seriousness of the wartime fables to the irony of "The Painter" and "Tale of the Wicker Chair," which anticipate Hesse's movement toward social satire in the twenties. (p. xix)

Hesse's late stories, while they bring no new variations in form, nevertheless display his continuing experimentation with the forms of fantasy. Indeed, the narrative is often encapsulated within a speculative framework in which the writer reflects on the nature of fantasy. "Nocturnal Games" embeds the account of several dreams in a rumination on the meaning of dreams in Hesse's life. "Report from Normalia," the fragment of an unfinished novel that might well have grown into a satirical counterpart to the utopian vision of The Glass Bead Game, depicts a Central European country "in the north of Aquitaine." "Normalia," we are told, emerged by expansion from the parklike grounds of a onetime insane asylum to become the most rational nation in Europe. But Hesse, making use of a fictional device that has recently appealed to writers of the absurd, casts doubt on all our assumptions concerning "normality." The narrator, it turns out, is ultimately unsure whether the former madhouse he inhabits has indeed become the seat of sanity in a mad world or whether it is not in fact still a madhouse. In "Christmas with Two Children's Stories" the two fairy tales—Hesse's own and the tale written by his grandson—generate a theoretical digression on the function and nature of fantasy. And in "The Jackdaw" … Hesse shares with us the manner in which his imagination plays with reality to generate stories about an unusually tame bird that he encounters at the spa in Baden. (pp. xxii-xxiii)

While fantasy in the unadulterated form that it displays in "Pictor's Metamorphoses" (where we are dealing literally with an "other-world" in Tolkien's sense) occurs infrequently in Hesse's mature works, it is fair to say that the tendency toward fantasy is evident in his writing from childhood to old age. Indeed, fantasy can be called the hallmark of Hesse's major novels of the twenties and thirties, the surreal quality that disturbs critics of a more realistic persuasion: for instance, the Magic Theater in Steppenwolf or the fanciful scenes in The Journey to the East, where reality blends into myth and fantasy. Indeed, fantasy is a state of mind into which Hesse and his literary surrogates enter with remarkable ease. (p. xxiii)

It would be a mistake to regard the tendency toward fantasy, in Hesse or other writers, as mere escapism…. [Fantasy], with its explicitly didactic tendency, represents not so much a flight from confrontation as, rather, a mode in which the confrontation can be enacted in a realm of esthetic detachment, where clear ethical judgments are possible. Indeed, fantasy often reveals the values of a given epoch more vividly than the so-called realisms it may bring forth. In any case, a generation that decorates its walls with the calendars of the Brothers Hildebrandt while perusing Tolkien's Lord of the Rings, that hastens from meetings of the C. S. Lewis Society to performances of space fantasies like Star Wars, has mastered the semiotics necessary to decode the hidden signs of "Pictor's Metamorphoses" and Hesse's other fantasies. (pp. xxiv-xxv)