Fable is designed to offer pure, concentrated role-playing, with a primary emphasis on open character development and influential interaction with the game world. The game begins as the player's character enters the fantasy land of Albion, a growing, interactive environment that develops and changes with each new event. The character grows and changes as well, beginning the adventure as a youth but slowly aging as he or she lives life in Albion, gaining wrinkled skin, graying hair, and (hopefully) becoming quite elderly by the end of the story.

The game is designed such that every choice and action the character makes can have an effect on his or her development. Physically active characters become more fit, while those who spend their time studying the arcane arts may develop receding hairlines. Characters who spend time working in the hot sun will get a tan and individual wounds heal into distinct, telling scars. Less tangible characteristics mature according to behavior as well. Players are free to commit nearly any conceivable action, but acts of cruelty will lead to vilification by NPC townsfolk, while noble and altruistic deeds may inspire loyalty and adulation from the masses.

It is important to note that instead of focusing on a limited number of scripted "good versus evil" plot points, character development in this game occurs mostly through hundreds of minor day-to-day decisions that gradually come to define and refine the player's place in the game world. In short, Xbox gamers are offered a virtual lifetime of choices to play through. Fable is developed by Big Blue Box, an affiliate of Lionhead Studios, whose popular Black & White shares the theme of free-form, consequential character development over a broad span of time.