Science fiction differs from fantasy in that, within the context of the story, its imaginary elements are largely possible within scientifically established or scientifically postulated laws of nature (though some elements in a story might still be pure imaginative speculation). Exploring the consequences of such differences is the traditional purpose of science fiction, making it a "literature of ideas".Science fiction is largely based on writing entertainingly and rationally about alternate possibilities in settings that are contrary to known reality.

These may include:

• A setting in the future, in alternative time lines, or in a historical past that contradicts known facts of history or the archeological record
• A setting in outer space, on other worlds, or involving aliens
• Stories that involve technology or scientific principles that contradict known laws of nature
• Stories that involve discovery or application of new scientific principles, such as time travel or psionics, or new technology, such as nanotechnology, faster-than-light travel or robots, or of new and different political or social systems

Definitions

Science fiction is difficult to define, as it includes a wide range of subgenres and themes. Author and editor Damon Knight summed up the difficulty by stating that "science fiction is what we point to when we say it"., a definition echoed by author Mark C. Glassy, who argues that the definition of science fiction is like the definition of pornography; you don't know what it is, but you know it when you see it.Vladimir Nabokov argued that if we were rigorous with our definitions, Shakespeare's play The Tempest would have to be termed science fiction.

According to science fiction writer Robert A. Heinlein, "a handy short definition of almost all science fiction might read: realistic speculation about possible future events, based solidly on adequate knowledge of the real world, past and present, and on a thorough understanding of the nature and significance of the scientific method." Rod Serling's definition is "fantasy is the impossible made probable. Science Fiction is the improbable made possible." Lester Del Rey wrote, "Even the devoted aficionado– or fan- has a hard time trying to explain what science fiction is", and that the reason for there not being a "full satisfactory definition" is that "there are no easily delineated limits to science fiction."

Forrest J. Ackerman publicly used the term "sci-fi" at UCLA in 1954, though Robert A. Heinlein had used it in private correspondence six years earlier. As science fiction entered popular culture, writers and fans active in the field came to associate the term with low-budget, low-tech "B-movies" and with low-quality pulp science fiction. By the 1970s, critics within the field such as Terry Carr and Damon Knight were using "sci-fi" to distinguish hack-work from serious science fiction, and around 1978, Susan Wood and others introduced the pronunciation "skiffy." Peter Nicholls writes that "SF" (or "sf") is "the preferred abbreviation within the community of sf writers and readers." David Langford's monthly fanzine Ansible includes a regular section "As Others See Us" which offers numerous examples of "sci-fi" being used in a pejorative sense by people outside the genre.