A fairy tale is a story, usually told to children, concerning the adventures of mythical characters such as: fairies, goblins, elves, trolls, giants and others. Also, it often involves princes and princesses. American fairy tales normally have a happy ending, but German and other European tales most often have a bad ending (e.g., a girl plays with matches and burns the house to the ground). Often, fairy tales were disguised morality tales. This is true for the Brothers Grimm Fairy Tale Collection, and many of the tales of Hans Christian Andersen.
An extensive collection of European fairy tales were published by Andrew Lang in a series of books: The Red Fairy Book, The Orange Fairy Book, and so forth. These provide some excellent examples of the genre. Some have also classed the Middle Eastern tales from 1001 Arabian Nights as fairy tales.
The fairy tale is a sub-class of the more general folktale.