Fantasy is an ancient form of literature in which some or all of the characters are non-human, and which relies upon imaginary settings. It is as ancient as the narratives of plays, mythologies, and epic stories in such works as the Odyssey of Homer, Virgil's Aeneid, the dramas of the Greek Classical period (Aeschylus, Euripides, etc.).
Below you will find a PDF of a presentation on the history and definition of Fantasy as a mode and genre, and how it differs from Science Fiction.