Imagination, fancy, fantasy are comparable when denoting either the power or the function of the mind by which mental images of things are formed or the exercise of that power especially as manifested in poetry or other works of art.
The meanings of all of these terms have been greatly influenced by changing psychological and aesthetic theories, with the result that in the past they have often carried implications or connotations and sometimes denotations not observable in modern use.
Imagination is not only the most inclusive of these terms but the freest from derogatory connotations. As an inclusive term it may apply either to the power of forming images of things once known but now absent or to the power of forming images of things not seen, or actually nonexistent, or incapable of actual existence.
In the first instance the term suggests the use of memory as well as of the image-making power.
In the second it usually suggests either a new combination of elements found in one's experience or an ability to conceive of something, seen only fragmentarily or superficially, as a complete, perfected, and integral whole.
Fancy (see also FANCY 3 ) usually means the power to conceive and give expression to images that are far removed from reality or that represent purely imaginary things.
In aesthetic use there is a tendency to make imagination and fancy antithetical. Imagination is often used to designate the power of representing the real or what gives an illusion of reality in its entirety and organic unity and, usually, in its ideal or universal character; fancy, the power of inventing the novel and unreal by recombining the elements found in reality. So interpreted, imagination represents men not only in their outward but in their inward life, and produces a Hamlet; fancy presents them in alien surroundings, or essentially changed in their natural physical and mental constitution, and produces centaurs and Brobdingnagians.
Fantasy often takes the place of fancy in naming the power of unrestrained and often extravagant or delusive fancy or its exhibition in art.