Fictional information presents a unique challenge to the developing child. Children must learn when it is appropriate to transfer information from the fictional space to the real world and what contextual cues should be considered in this decision. The current research explores children’s causal inferences between fictional representations and reality by examining their developing sensitivity to the proximity of the fictional world to the real world, and the effect of this judgment on their subsequent generalization of novel causal properties. By 3-years of age, children are able to evaluate the data that they receive from fictional stories in order to inform their generalization of novel story content to the real world. Additionally, as children develop, they become better able to discriminate between close (realistic) and far (fantastical) fictional worlds when assessing which stories are likely to provide relevant causal knowledge.