The Yarn is the realm of stories in goblin mythology. Goblins believe that there are many spheres of existence; while occupying the real world, all people are tied to the Yarn through stories. Favoured individuals go to the Yarn after death (when they enter legend); it is also possible to traverse the Yarn in sleep, or through imbibing certain substances (traditionally, food embalmed in rose petals). The Yarn is protected by the head of the goblin pantheon, the God-Mother; those skilled in traversing the Yarn may be as lucky as to meet her there.

In Written on the Leaves, the Nix managed to transform the Yarn into the Monomyth, a construct it created as the perfect story. Those who entered the Monomyth through sleep became trapped there, unable to wake as they reenacted the same story over and over again. Having been challenged regarding its actions, the Nix restored the Yarn to its former state.