In 1970, when the first English translation of Cien años de soledad appeared, the Anglophone world suddenly discovered a whole wealth of Latin American literature that went by the name magic realism. But magic realist literature (the term was appropriated from German art criticism in the 1920s) did not begin with Gabriel Garcia Marquez. One origin story takes it back to the Cuban writer Alejo Carpentier, who developed what he called marvellous realism in the 1940s. But in fact work that is recognisably magic realist had appeared before that in the Argentine literary magazine Sur, founded and largely edited by the critic Victoria Ocampo in the 1930s. The most prominent writers who appeared in Sur were probably Victoria's sister, Silvina Ocampo, Silvina's husband, Adolfo Bioy Casares, and Bioy's lifelong friend and occasional collaborator, Jorge Luis Borges. Bioy and Borges achieved international fame, but outside the Spanish-speaking world Silvina Ocampo is probably far less well known than her work deserves. Which is why this new selection of her stories is so welcome.

Daniel Balderston, an enthusiast for Ocampo's work, has brought together a selection of forty-two stories taken from the seven collections she published between 1937 (Forgotten Journey) and 1988 (Cornelia Before the Mirror). Sensitively translated, they provide a vivid and compelling introduction to the work of an enchanting and strangely disturbing storyteller.

Ocampo originally intended to be a painter, and studied art with Giorgio de Chirico and Fernand Lèger in Paris. Although she apparently did not get on with de Chirico, the atmosphere conjured by his surreal and slightly threatening cityscapes certainly carries over into her fiction. Her stories are mostly very short, several are no more than two or three pages long, and they are carefully situated in detailed urban or more often suburban landscapes in which something curious or unsettling happens. A hunchback is (fatally) ironed flat by raucous partygoers; young lovers gorge themselves on cream cakes; a husband trains canaries to peck out his own eyes in recompense for blinding his wife's would-be lover; a girl dreams of becoming a doll.

Some of the stories, particularly from her last two or three collections, contain elements that are overtly fantastic. In "The Doll," a young girl discovers that she can foresee the future; in "Sheets of Earth" a gardener's hands take root in the soil he is tending; in "And So Forth" a youth meets a mermaid on the seashore. But even in these stories the fantastic is not to the fore: we are told more about the young girl's unhappy childhood, the youth's loneliness, the gardener's long career; the irruption of the fantastic is as quiet and as natural a part of events as anything else in the story.

For the most part, however, anything magical emerges from the stories more by implication than by statement. They seem real, except twisted in some way, approached from an oblique or perverse angle. It is often no more than an unlikely juxtaposition of adjectives that alerts us to a world being seen from an unusual angle, as when a patient notes that "[t]he doctor is at once torturer and jeweller" (p. 202), and later in the same story, "Visions," imagines "[t]hey are doctors' faces. They have hands but no bodies or souls" (p. 205). Is this what the patient really sees, or is it a representation of her illness? Either way, the world has become unstable. This is realist fiction that is somehow askew. In "Cornelia Before the Mirror," a woman who wants to die has a long, surreal conversation with a burglar and possible assassin, in which he cries in frustration: "If I turn to the left you twist to the right; if I turn to the right you twist to the left" (p. 322), which seems to sum up Ocampo's approach to fiction perfectly: the stories turn away in unexpected directions. If you squint at them hard enough, they may remain blamelessly realist, but that hardly seems worth the effort. It is by accepting the subtle distortions that work their way through these fictions that we discover what is most engaging and disturbing about Ocampo's work.

In a typically short piece, little more than a vignette, called "The Objects," a woman gradually rediscovers all the things she had lost during the course of her life: bracelets, ornaments, toys. As they accumulate, the objects come to dominate her life, until in a perfect final line that captures the very essence of Ocampo's fiction we learn that: "Through a long series of joys, Camila Ersky had finally entered hell" (p. 132). In just two pages, our perceptions are completely turned around: what started as an odd but explicable coincidence becomes an overwhelming oddity, what was first benign ends up as malign.

This, the skull beneath the skin, as we might put it, is Ocampo's subject. Under the smooth, prosperous suburban surface we detect horrors and disturbances. In "The Sibyl," a petty criminal discovers a house filled with riches ripe for the taking and with no one to protect it other than a strange child sitting on the stairs who engages her in oracular conversation. When the criminal returns one night with two friends intent on robbery, she finds the child once more in place, who warns her that her friends will kill her when she leaves the house. Inevitably, she goes to the door; inevitably, she is shot. Murder, death, is not the invariable subject of these stories, but they lead often enough to intimations of mortality. There is no way to cope with the emptiness of this life other than by the leaving of it. But the agent of this disturbance is very often a child. Young girls in particular fill these stories, regarding murder as an innocent act, regarding innocence as somehow perverse. And for those who encounter them, children embody the madness that underlies everything. In "The Fury," a lover's erotic assignations are accompanied by the constant beat of a child's drum, an inescapable noise like Poe's "Tell-Tale Heart" that eventually drives him to mayhem.

All of this, the twists and contradictions, the threat of childhood, the promise of death, comes together in the longest and best story in this collection, "The Imposter." Luis Maidana is travelling to a remote and dilapidated farmhouse to spend the summer with Armando Heredia. The two don't know each other, but their fathers are close and so Luis has been asked to keep an eye on Armando, about whose behaviour strange reports have started to surface. Luis is uncomfortable with the idea of being a spy, but he is going on the pretext that he will spend the time catching up on his schoolwork (which is meant to set a good example for Armando), though from the start we learn that he has forgotten the key textbook he needs. On the train he meets a girl who is introduced to him as Claudia, though she wears a jewel that spells out the name Maria, an early example of the doubling, the uncertainty of identity, that continues throughout the story. Later, for instance, he learns that Armando is in love with a girl called Maria who may or may not be the Claudia he met on the train; Armando insists on meeting, the girl alone, but when Luis tries to spy on the meeting no girl turns up. At one point, Luis has a night-time encounter with Claudia which matches precisely a story that Armando tells about one of his meetings with Maria. Yet there are also suggestions that this Maria has been dead for some years. Armando and Luis become close friends from the moment they first meet, but over the course of the summer Luis becomes more and more convinced that his friend is mad. And yet Luis's own behaviour, claiming to recognise things that he admits he has never seen before, or recounting as fact events we subsequently learn are dreams, means that his narration also becomes questionable. Eventually, as guns and knives start to appear more and more in the story, Luis comes to believe that his own life is in danger and prepares to flee. At which point, the narrative switches abruptly: we are reading the report of another youth travelling to a remote and dilapidated farm to spend time with Armando Heredia. What he finds there makes us doubt every single thing we have learned in the story so far.

It's a powerful and absorbing novella, but what is most impressive about it is that not once, through tone of voice or choice of word, does Ocampo suggest that this is anything other than a straightforwardly realist account. It is only as the details accumulate, as we start to recognise repetitions that the narrator never once calls attention to, do we begin to realise that something profoundly weird is going on here. A sense of the weird then hangs over every subsequent story in the collection. If magic realism unearths a sense of the numinous beneath the everyday, and a sense of the rational within the most outré, then nobody does it with the same delicate and insouciant mastery as Silvina Ocampo. We can only hope that this marvellous collection brings her to the attention of the wide readership she so richly deserves.

Paul Kincaid is the author of two collections of essays and reviews: What It Is We Do When We Read Science Fiction and Call and Response. He has received both the BSFA Non-Fiction Award and the Thomas D. Clareson Award.