This article deals with the origin, content and development of the collection of The Thousand and One Nights and its reception in the Western and Eastern cultural and literary environments. The collection has been evolving in the Oriental environment for more than a thousand years. Although the original core of stories was relatively small, as the collection travelled from territory to territory, more and more narratives of various cultural and geographical origins were being added to it. Editors and translators have been modifying and reshaping its content over and over and so its character has been constantly changing. While the Western writers have considered the collection a true repository of inspiration, the opinion of the Arab intellectual elite was not always that positive.