This document highlights the portrayal of liberalism and fantasy in children’s fiction novels “Christmas Carol” and “The Wonderful Wizard of Oz” (Adsit, 2011). Realism and Fantasy in Literature Realism refers to a truthful aspect of life which are put forward after observations of different facts and features of events taking place in the life. In literature, realism is an approach, which describes the understanding of life without a subjectivity of an ideal life, fantasies or romantic interests. These realistic approaches are the product of all the influential bodies pertaining in everyday life and they are placed specially among the lower and middle classes of the society. The social factors of the environment play a very significant role in realistic literature. The psychological elements of individuals are also examined in realistic approach in the literature (Villanueva, 1997). Realism in literature emphasizes on proper documentation of the events, which are taking place, with an insight of all sociological aspects and details of facts and figures of life. There are few elements, which are avoided like poetic diction and melodrama in this approach and the subjects’ issues of lower middle class families of societies are elaborated. (Stoodt, 1996) Fantasy, on the other hand depicts such characters which may not be real, they can vary from fairy tales as well as about demons that take us on a journey of imagination and metaphysical form of literature (Horne, 2011). Most of the Science fiction tales come under this category. The metaphysical literature deals with such subjects which can be supernatural and the characters will inhibit traits of super natural beings like dragons and wizards, fairies or vampires (Miller, 1997). Hence, the fantasy literature incorporates such super natural or unrealistic notions, which may provide an understanding of the structural elements and characteristic features taking place in such setting. (Schmitz, 2008) Most of people enjoy fantasy because of the concepts underlined in the structure of this kind of literature (Hudson, James, & Christopher, 2003). People are more inclined towards the theories in literature, which depict good against evil, magic and demons and explore concepts, which in reality may not be of any use but may have a profound impact on how a person perceives the situation. (James & Mendlesohn, 2012) Studies of Realism and Fantasy Literature in Schools In order to keep children focused on realities of life and the impact of realistic events in the lives of a common man, it is necessary to introduce realism in literature in studies by introducing novels which are depicting which can have a positive impact in their upbringing and development (Adams, 1990). However, practically speaking the idea of realism in fiction novels may differ in different people (Klemmer, Anoop, Chen, Landay, & Aboobaker, 2000). The depiction various scenarios by writers may be perceived differently because there are cases when a realistic event may seem illusory to one person and realistic to another (Wolf, Coats, & Enciso, 2010). Exploration is required in terms of confusion of such realism in literature so that there is understanding of literature as a basic course in children’s school to promote learning through fictional tales.