While the fact that fantasy novels create an alternate reality is fairly apparent, it is important to recognize that the world imagined by the author must have carefully constructed rules. For instance, in J.K. Rowling's Harry Potter series, it is mentioned early on that no characters cannot "apparate" or "disapparate" (appear and disappear, magically) in the grounds of Hogwarts, and the author sticks with this rule throughout her series. Creating rules for a world helps establish an author's credibility. Because the real world has complex rules, an imagined world must also have complexity and details to appear fully alive. The richer the details of an environment, the more the reader is willing to accept what would otherwise be dismissed as impossible. The rules constructed in an alternate reality also create a tension that wouldn't otherwise be present. If a character could use magic to escape any tense situation, readers would never have the opportunity to worry for that character, or delight in his ingenuity in escaping near disaster.
Fantasy novels often involve a quest that must be completed by the narrator, who is often an unlikely hero. In J.R.R Tolkien's Lord of the Rings series, Frodo Baggins, a not entirely heroic figure, had to find the strength within himself to destroy the ring. In J.K. Rowling's Harry Potter series, Harry was charged with killing Lord Voldemort. This quest gives shape and purpose to the world the reader is inhabiting, and allows us to see a normal character become something extraordinary.
Many fantasy novels contain anthropomorphism, which is the practice of attributing human characteristics to animals. First and foremost, this practice lends itself to the magical nature of a fantasy novel. It is also used as symbolism. A lion is seen as a valiant animal, and so when a lion is able to talk in the world of a fantasy novel, we instinctively know to give respect to what it says.
An allegory is a larger story that exists under the surface of a fantasy, and allows the author to express opinions without directly addressing the subject. It is fairly well-acknowledged that The Lion, the Witch and the Wardrobe is an allegory retelling traditional Christian stories, and it has been suggested that J.K. Rowling's Harry Potter series is as well. J.R.R. Tokien's Lord of the Rings trilogy has been interpreted as everything from a Christian parable to a dissertation on foreign policy.