Surrealism in Magic Realism
Magic Realism as we know it wouldn't exist if it weren't for Surrealism, a movement in the visual arts and literature that developed in Europe in the early 1920s.
Surrealism was all about blurring the boundary between dream and reality in order to see reality in a new way. You've probably seen some crazy paintings by the Surrealist Salvador Dalí: they're full of melting clocks, trees as heads and heads as trees, people as rocks and rocks as people, and all other kinds of strange stuff.
Sound a little bit like Magic Realism? That's partly because Magic Realist writers took inspiration from Surrealist artists like Dalí, and Surrealist writers like André Breton. Like the Surrealists, the Magic Realists were interested in looking for new ways to write about reality, in particular its irrational or fantastic elements.
Chew on This
The protagonist of Franz Kafka's Metamorphosis wakes up as an insect. If that ain't surreal, we don't know what is. Check it out here (Quote #1).
Pelayo, the protagonist of Gabriel García Márquez's "A Very Old Man With Enormous Wings," doesn't know whether he's dreaming or waking when he finds an old dude with wings just sitting around in his backyard. Here are a few quotes about this surreal event.