Since the 2006 debut of her Orange Prize-nominated novel, Lullabies For Little Criminals, Canadian author Heather O'Neill has developed a knack for writing about the underbelly of her native Montreal. In startlingly original prose, she casts a romantic sheen on even the most desperate of situations.

Her third and latest novel, billed as "a fairy tale with a wicked heart", puts a spin on this formula by casting two characters in a love story set in the 1930s era of the Great Depression.

The opening sequences have Dickensian echoes: Two babies are abandoned at an orphanage during a gloomy winter in Montreal and grow up in the oppressive institution. The boy, Pierrot, has a gift for tickling the ivories, on top of acrobatic performances and crafting extraordinary tunes. The girl, Rose, is a natural magician and skilled at improvising exquisite acts, including miming a dance with an imaginary bear.

They find solace from abuse and punishment in the world of make-believe and are inexorably drawn towards each other. But they end up being separated after leaving the orphanage as fate deals them a cruel hand.

The stakes are raised higher in the adult world as they work their way towards an impossible reunion while inhabiting various identities: a companion to a wealthy man, a governess, a thief, a porn star, a mistress, a drug addict and producers of a circus show.

O'Neill staunchly refuses to conform to tropes or stereotypes, whether in terms of her treatment of characters or her use of language.

She is keenly aware of how even the most reckless or cruel of people's impulses are shaped by circumstance and vulnerabilities, and displays a genuine empathy for the marginalised who have slipped through the cracks in the labyrinth of urban Canada - prostitutes, drug pushers or even the kingpins of the underworld. Similes and metaphors take the darkness of their plights and unspool it into surreal, dream-like scenes: A heroin addiction feels like wings that want to break free, "pushing against each other like two children in a school yard"; leaves from a tree in a desolate park are like "poems that had fallen to the ground".

Despite the fantastical premise, O'Neill's treatment of weightier issues, such as gender dynamics and or trauma, remains unflinching.

The novel is not just a love story, but also one that demonstrates a belief in the profound power of the imagination.

It aches to the bone when it acutely paints a mesmerising picture of how an unyielding conviction in life's endless possibilities can give rise to triumphs over limiting circumstances.

If you liked this, read: All The Light We Cannot See by Anthony Doerr (Scribner, 2014, $19.26, Books Kinokuniya), a novel set in occupied France during World War II that centres on a blind French girl and a German boy who cross paths.

Yuen Sin