"Kingdom of the Fairies" is undoubtedly one of Georges Méliès's best féeries, or fairy films, alongside other such ones as "Blubeard" (1901) and, if you want to consider it as part of the genre, "Le Voyage dans la lune" (1902). It is also one of his best films in general. Its narrative follows the abduction of a princess by a wicked fairy/witch, and her subsequent rescue by the prince (played by Méliès)--an adventure which takes the prince and his men to the depths of the sea, where they meet the kingdom of the fairies, ride inside a whale to shore, and to the eventual rescue of the damsel from a burning castle. This was one of the most elaborate Star Film productions, with 20 some changes of scenery, a requirement of many costumes, and a runtime nearing 20 minutes.
Méliès consistently produced the best movie set designs of his era, but the ones in this film especially stand out, including the undersea design and the burning and collapsing castle. Even the miniature model scene of the ship sinking works, because, after all, it's fantasy. The aspect, however, that I particularly appreciate in these fairytale films is their frequent use of the fairy as a narrator, or manipulator of the characters and plot. Another good example of this can be seen in "Bluebeard", as well as in films by others, such as "The Magic Sword" (1901) and "Jack and the Beanstalk" (1902). One scene in "Kingdom of the Fairies" is especially remarkable: it's a vision scene projected by the wicked fairy to the prince and involves the changing of the scenery from the castle room to the vision and back to the castle room.
(EDIT: The hand-colored print now available on home video makes this film look even better.)