Understand the difference between the fantasy and science fiction genres. Although both generously flirt with magical notions of "what might have been" and "what could be", fantasies are an embodiment of mysticism, legend and faith whose existence has no logical explanation. Further, the emotions governing the actions of characters in a fantasy are predicated on a purely mortal code of right versus wrong.
Decide what kind of fantasy novel you want to write. Examples include story lines about witchcraft and magic spells; mythical creatures (i.e., vampires, werewolves, mermaids, fairies, unicorns); time-travel; reincarnation; and ancient prophecies.
Identify the central theme of your fantasy premise. Successful plots are based on themes of reward, revenge, escape or a combination of these three. In addition, a successful fantasy revolves around (1) an ordinary person thrust into an extraordinary environment or (2) an extraordinary individual forced to function in an ordinary setting.
Identify your target audience for the book (i.e., children, teens, females). Read what your competition has already produced for these readers. For example, if you plan to write a vampire teen romance, it would behoove you to read Stephenie Meyer's "Twilight" series about Edward and Bella. In contrast, if you're writing a vampire fantasy targeted to adults, it may be time for you to revisit Bram Stoker's "Dracula". The reference books listed at the end of this article can get you started if you're not familiar with who has written what in this genre.
Decide who your main character will be and what is at stake that will force her to take escalating risks. Perhaps she needs to save her kingdom from a dragon. Perhaps she has been transported to 21st century New York and needs to figure out how to get back home. Perhaps she's on a quest to recover a stolen object before it can unleash destruction.
Identify who will oppose your main character in accomplishing her objectives. Keep in mind that villain characters can't be bad just for the sake of being bad; their motives need to be just as strongly defined as your protagonist.
Determine the physical setting and circa of your story; i.e., a battle that is fought on the heroine's own turf or one that transports her to a completely different realm where she has neither allies nor familiarity with the terrain, customs and language.
Establish the ground rules, boundaries and limitations of the fantasy world you're creating, especially if you're imbuing your characters with special powers and abilities. Readers will accept virtually any premise you create but will roll their eyes in annoyance if you resort to frequent contrivance or make the writing sound as if you're just making things up on the spot. Even in a fantasy genre, everything needs to be as tightly constructed as it would if you were writing about "normal" characters and interactions.
Create a three-act outline before you start writing your book. The easiest way to do this is to decide on the total word count of your book and divide it by three. For instance, if your fantasy is going to be 60,000 words, you'll have 20,000 words to devote to each act. Jot down notes of what needs to occur in the beginning act, the middle act, and the last act. This rough draft will help you to keep your focus as you write and prevent you from spending so much time creating subplots that you end up veering off-course from the protagonist's central conflict.
Introduce foreshadowing as early in the book as possible. Use red herrings liberally to keep your audience guessing about the outcome.
Listen to your characters as you write and allow them to lead you to ideas you might not have previously considered. These "voices" are your subconscious mind at work which continues to immerse itself in various elements of the plot even when you're asleep.
Join a critique group and get feedback on your fantasy novel while it's in progress.