The Neverending Story occurs in the school attic, where Bastian reads the book he has stolen, and in Fantastica, the land where the action occurs and where Bastian goes after he enters the book. Bastian is outside of the school only at the beginning and at the end of the novel. At the beginning he is on his way to school when he stops in the bookstore and steals the book; at the end he goes home to his father and returns to the bookstore for a final meeting with Mr. Coreander.

As its name implies, Fantastica is a fantasy land, a fantastic place that "rests on a foundation of forgotten dreams" of all humankind. The characters of fantasy stories live in it, and the settings of fantasy stories form its terrain, making Fantastica a constantly changing landscape inhabited by characters who are at times bizarre, touching, or...