Urban fantasy is a subset of contemporary fantasy, consisting of novels and stories with supernatural and/or magical elements set in contemporary, real-world, urban settings--as opposed to 'traditional' fantasy set in imaginary locations. 

Many urban fantasy novels are told via a first-person narrative, and feature supernatural beings such as vampires, shapeshifters, fairies, witches, sorcerers, and demons. Urban fantasy stories tend to have a high amount of suspense and action, and sometimes include mystery, romance, humor and/or horror in the plotline.