The Storytime is another undefined place and time, like the Winter or the House of All Worlds. It appears as a dark, rugged landscape that is either shadowy or simply overcast, not unlike the Guardian's Realm when the seat in the Tower is empty. Overhead, lights like stars seem to be falling, while a curious vapour rises from crevasses in the ground. The only features yet seen in the Storytime are a tree and a fire burning nearby. The fire is tended by a curious figure known as the Vagabond, who appears to be waiting for someone.
The Storytime is also host to less savoury powers. When Brian Westhouse is sent to Arcadia from the Tibetan monastery, he first ends up in the Storytime. The Vagabond is not pleased to see him, and urges him away quickly, saying that he should not be there and that he does not belong there. From the sky above them, a black mass not unlike the Chaos Vortex issues forth, and attacks Brian. The Vagabond names this mass 'the Undreaming'.
When the Vagabond meets Zoe Castillo, he says they don't have much time, but he is much more interested in the story Zoe has to tell him, and there is no sense of urgency when he speaks to her. There is a marked difference between the way he acts towards Zoe and his reaction to Brian's presence, possibly because Zoe is a 'Dreamer' and Brian, presumably, is not. The Vagabond's antagonism towards Brian appears, oddly, to be personal; he stresses "What are you doing here? You cannot be here."
According to what the Vagabond tells Zoe, the Storytime seems to be very much like the Aboriginal concept of the 'Dreaming'. When Zoe is in the Storytime she states that she isn't sure if she is dead or not. The Storytime appears to be a between-place or a place where things are created, rather than a world in its own right. The link to Aboriginal mythology has been confirmed by Dag and Ragnar themselves, in the twitch.tv livestream (01:01:30), where they encouraged people to research it because "it is central to the whole mythology of the TLJ universe".
The upcoming sequel will find Zoe still stuck in the Storytime while her comatose body lies in a Casablanca hospital. To escape she must learn to control her abilities as a Dreamer.
Concept art for the Storytime appears to show the Vagabond standing defiant while dark spectres wheel overhead.