FANTASY designates a conscious breaking free from reality. It applies to a work that takes place in a nonexistent and unreal world such as a fairyland, or concerns incredible and unreal characters, or relies on scientific principles not yet discovered or contrary to present experience, as in some science fiction or utopian fiction. FANTASY may be employed merely for whimsical delight or it may be the medium for serious comment on reality.
FANTASY is not my genre, but oh how I loved The Hobbit, one of my favorite books ever. Why is that, fantasy readers? Why would someone who can't stand to get past one chapter of a fantasy book (I only read Harry Potter to see what all the fuss was about), have The Hobbit as one of her favorites? I don't know the answer to that.
(This post has been inspired by and in some instances, directly quoted from A Handbook to Literature, 8th Edition, by William Harmon and C. Hugh Holman)