Unlike the earlier Märchenbilder (Fairy Pictures), in which individual pieces evoke specific associations, the Märchenerzählungen (Fairy Tales) have no direct reference to any narrative or underlying program. The work was composed October 9-11, 1853, not long before Schumann's final mental breakdown and suicide attempt. Nevertheless, the music is concise and light-hearted, the four movements linked by a recurring motive. It is one of Schumann's most organically conceived works. Schumann originally wrote the piece for clarinet, viola, and piano, but the first edition, published in 1854 by Breitkopf & Härtel, offers a choice of violin or clarinet.

Throughout the highly condensed, four-movement work is a sense of increasing agitation. The most intriguing aspect of the Märchenerzählungen is the "kernel" of music from which much of the piece is derived. This appears early in the first movement, "Lebhaft, nicht zu schnell" (Lively, not too fast), which begins with a legato phrase in the viola that tends to move upward. A contrasting idea ensues that is detached and generally moves downward—this becomes the kernel of the rest of the piece. A song without words, the movement features an excellent blend of the instruments and intense development of the first theme. In the second movement, "Lebhaft, sehr markiert" (Lively, very accentuated), the kernel appears in numerous short outbursts in the opening segment of the movement that distort the kernel by presenting it in a fast, triplet rhythm. This movement is more clearly ternary in form, with a great change of mood in the elegant middle section. The third, slow movement, "Ruhiges tempo mit zartem Ausdruck" (Calm tempo with delicate expression), has a much more lyric, idyllic feel than the previous movements and features an important accompanimental figure in the opening measures that is an augmented version of the kernel. Furthermore, this figure, and thus the kernel, informs much of the melodic material of the movement, especially in a duet for the clarinet and viola. The Finale, "Lebhaft, sehr markiert," opens with powerful chords and seems, at first, unrelated to the previous sections. The melody, however, is a dotted-rhythm version of the kernel. The same idea also returns, augmented in the slow middle section of the Finale.

Although the movements are similar in form to the three-part character pieces found in Schumann's other works, the sections of Märchenerzählungen are rhapsodic in structure and tempered with an awareness of Viennese, Classical-era rhetoric.

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