In psychology, fantasy is a broad range of mental experiences, mediated by the faculty of imagination in the human brain, and marked by an expression of certain desires through vivid mental imagery. Fantasies are generally associated with scenarios that are impossible or unlikely to happen.
Psychic mystery by Margret Hofheinz-Döring
Rêverie (Daydream), 1901, by Paul César Helleu
Imagination is the production of sensations, feelings and thoughts informing oneself. These experiences can be re-creations of past experiences, such as vivid memories with imagined changes, or completely invented and possibly fantastic scenes. Imagination helps apply knowledge to solve problems and is fundamental to integrating experience and the learning process. As a way of building theory, it is called "disciplined imagination". A way of training imagination is by listening to storytelling (narrative), in which the exactness of the chosen words is how it can "evoke worlds".
Olin Levi Warner, Imagination (1896). Library of Congress Thomas Jefferson Building, Washington, D.C.