While a student at Harvard, Fales took a course about the novel taught by literary scholar and author Bliss Perry, an experience which inspired him to begin collecting the authors focused on during the semester: Charles Dickens, Anthony Trollope, William Makepeace Thackeray, and Sir Walter Scott. After focusing on these authors, Fales began to branch out, collecting works by members of each author's literary circle, and eventually expanding the scope to initially include all of the nineteenth-century British novelists. Partly inspired by the large amount of piracies of popular British authors of this period, Fales also collected American fiction, including writers such as Charles Brockden Brown, James Kirke Paulding and James Fenimore Cooper.
Another of Fales' interests was the gothic novel, an eighteenth and early nineteenth century genre that provided the foundation for the detective novel, tales of mystery and horror, ghost stories and, eventually, science fiction. Unusually, Fales also collected contemporary fiction as well as historical titles, avidly seeking contemporary works of African American fiction and detective fiction. His goal was to build as comprehensive and documentary a collection of the English and American novel as was possible.
By 1957, Fales collection had grown to include nearly every genre, subgenre, period and development of the novel, largely housed at his home in New Jersey. Given that his father had lived on Washington Square, and encouraged by NYU faculty member Gordon N. Ray, Fales donated 10,000 volumes to the University in honor of his father, thereby founding the Fales Library. He continued to add to the collection and donate materials, building the collection of the Library to more than 50,000 volumes and over 15,000 literary manuscripts by the time of his death on June 19, 1966.
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