Final answer:
The genre that includes elements of fantasy or myth within a realistic setting is known as Magical Realism. Authors like Gabriel García Márquez helped popularize this genre, where fantastical elements are presented alongside the real in a dramatic and seamless narrative.
Step-by-step explanation:
A novel that includes elements of fantasy or myth in seemingly realistic fiction falls under the genre known as Magical Realism. This genre is characterized by the introduction of fantastical events in the real world, which are portrayed in a matter-of-fact manner that suggests that these magical events are perceived by the characters as part of their everyday life. Famous authors like Gabriel García Márquez and Jorge Luis Borges are known for their works in this genre, such as Márquez's 'One Hundred Years of Solitude'.
In magical realism, the ordinary is intertwined with the extraordinary, and it is this blend that creates the magical element of the narrative. Grounded in reality, magical realism explores the unknown and mystical without deviating from the realm of what is possible.