"Fairytale" is a song introduced on the Pointer Sisters' May 1974 album release That's a Plenty; written by group members Anita Pointer and Bonnie Pointer, "Fairytale" became the second of the three Top 40 hits scored by the Pointer Sisters in their original embodiment as a quartet - Anita Pointer would sing lead on all three of these hits.

Anita Pointer has stated that she wrote this breakup song from personal experience: pre-stardom the Pointer Sisters had written and recorded radio spots, for which purpose they'd borrowed equipment from San Francisco radio station KSAN, and Anita had become romantically involved with a KSAN deejay who'd neglected to mention being married - "He lied to me so when I found out that's when that song 'came out' [ie. took shape]". "Fairytale" was written while the Pointer Sisters were on one of their earliest tours as support for Dave Mason: staying at a motel in Anita was listening to a cassette by James Taylor - "I love him. I just think he’s so great. And I wrote Fairytale that night." At the conclusion of the tour with Mason, Anita gave what she'd written at the motel to Bonnie Pointer for polishing into the song which the Pointer Sisters recorded at Quadraphonic Studios in Nashville TN.

"Fairytale" was an extreme stylistic departure for the Pointer Sisters. The C&W- flavored song was not chosen as its parent album's advance single, that distinction being afforded in March 1974 to "Steam Heat." The latter was an exemplar of the group's typical swing era sound, but it failed to chart. A June 1974 follow-up single release originally featured "Fairytale" – pared down from the 5:07 length of the album track – as the B-side to a remake of the Vibrations' 1968 R&B hit "Love in Them There Hills." However, after "Love in Them There Hills" failed to attract interest at Pop- or R&B-formatted radio stations, "Fairytale" was pitched to C&W-formatted radio stations, a left-field maneuver which paid off with a debut on the Billboard C&W chart dated July 27, 1974. As the Pointer Sisters' label Blue Thumb had no C&W division, "Fairytale" was promoted in the C&W market by ABC Dot Records which, like Blue Thumb, was part of the Famous Music group.

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