Are not the same thing - not by a long stretch. And yet, they are often confused.
Walt Disney was Fairy Tales, happy stories, although often with a tiny bit of the dark left in. Faerie Tales, of the Brothers Grimm or Hans Christian Andersen variety, were scary as all get out, and meant to be that way.
One purpose of the original tales was to scare children into being good. Hansel and Gretel was not meant to show that good triumphs over evil, as it does now. Rather, it was meant to illustrate to children the dangers of not heeding their elders. Other fairy tales were politically motivated. Others were inspired by stories, or events, experienced by their authors.
For instance, The Ruby Slippers tells of the price paid by those who are vain, and what they may gain by repenting of their vanity.
And then there are the Fae themselves - those inhabitants of the World of Faerie. Skim a book on mythology, and you will find, not the sweet, cute, goodhearted Tinkerbell, or the pretty, sweet, human-with-wings fairy of 50's English childrens literature, but Puck, the Faerie King and his Queen. Not evil per se, but not human, and while human in appearance, not possessed of human emotions.
The Fae didn't care for humans, one way or the other - except for amusement value - Puck in particular was known for his pranks. Now, they are our friends and allies. Always, they are there to assist us. Mythology shows that, like the ancient Gods, they could and would help or hinder humans at their whim (the Lady of the Lake in the Camelot stories springs to mind).
Is this change a bad thing? Not really. I like the softer version of the tales for very young children. For myself, I have always preferred the darker versions (hence my absolute obsession with Tim Burton's Alice in Wonderland - a match made in Heaven). As a for instance, I have included a plot summary (filched from Wikipedia), of Andersen's The Ruby Slippers. Because it gave me nightmares as a child, and yet, I loved it anyway.
A peasant girl named Karen is adopted by a rich old lady after her mother's death, and grows up vain. She tricks her adoptive mother into buying her a pair of ruby slippers and repeatedly wears them to church, without paying attention to the service. Her adoptive mother becomes ill, and Karen deserts her, preferring to attend a party in her ruby slippers.
Once Karen begins dancing, she can't stop, the shoes take over. She cannot control them and they are stuck to her feet. The shoes continue to dance, through fields and meadows, rain or shine, night and day. She can't attend her adoptive mother's funeral. An angel appears to her, condemning her to dance even after she dies, as a warning to vain children everywhere.
Karen finds an executioner and asks him to chop off her feet. He does so and gives her a pair of wooden feet and crutches. Thinking that she has suffered enough for the ruby slippers Karen decides to go to church in order for the people to see her, but the chopped-off feet dance before her, barring the way.
The following Sunday she tries again, thinking of herself at least as good as the others in church, but again the dancing shoes bar the way. Karen gets a job as a maid in the parsonage, but when Sunday comes she dares not go to church. Instead she sits alone at home and prays to God. Then, it is as though the church comes home to her and her heart becomes so filled with sunshine, peace, and joy that it bursts. Her soul flies on sunshine to heaven, and no one there asks her about the ruby slippers.
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