Fiction is an open door into experiences that are beyond the here and now. It allows us to live different lives, visit different worlds, and meet people we might not find in our everyday paths. Engaging with fictional stories can thus help people expand their understanding of their social world. Social Psychology researchers have acknowledged the power of fiction by adopting stories as contact strategies to reduce prejudice from one group to another. The present work builds on research showing that engaging with fiction improves audiences' attitudes towards others. This thesis investigates psychological mechanisms involved in the relationship between fiction and prejudice reduction, by testing audiences' responses to fictional characters that portray individuals from sexual and gender minorities. These mechanisms are examined through five studies in terms of engagement with the story, and of individual characteristics which modulate this engagement. One study investigated prejudice towards gay men and lesbians, while three others focussed on prejudice towards transgender people. One more study shifted the focus from prejudice to identity processes linked to fiction engagement in transgender individuals-a group traditionally misrepresented by the media. In these studies, participants read or viewed stories, and answered a questionnaire about these stories and the people represented by the characters. The main results showed that emotional engagement with a story was associated with lower prejudice, while individual characteristics had no effect in this engagement. This thesis integrates fiction into a contact theory framework in two ways: First, it outlines the common ground between contact and fiction on the basis of emotions; second, it characterises the unique contact experience that fiction affords to audiences by using characters to blur the line between "us" and "them". Overall, this thesis examines fiction mechanisms that help recognise sexual and gender minorities as ordinary inhabitants of the social world.