All fiction includes narration (which might include descriptions of what is happening, a summary of what has happened, or an orientation to what is about to happen) and dialogue (thoughts—which we call inner dialogue—and conversations).
Both dialogue and description have weaknesses. Dialogue often becomes too explanatory. Descriptions often become repetitive and stall out the forward movement of the story.
That said, much of the strength of fantasy stories is world creation, that is, the ability to take the readers to an entirely different place and give them an immersive experience in a unique world. So, while dialogue is important, when writing in this genre you’ll use more description than boiled down dialogue. When writing about a familiar, everyday world—one that readers will immediately recognize and visualize—description is less important.
I found this out for myself when I was writing my fantasy novel Quest for Celestia. The world I was creating was full of danger and dragons and fantastic castles, and I had to work on the scenes for a long time before I could finally see them and really believe them.
Here’s an excerpt so you can see what I mean. (Kadin and his traveling companion Leira have just entered the infamous city of Wyckell):
The roads and buildings of Wyckell had been designed by someone with an eye for beauty as well as commerce. Most of the structures were made of stone gathered from the high plains and boulder-strewn fields surrounding the city. Many buildings were elaborate and ornate, but even the most modest homes were more beautiful than any I’d seen in Abaddon. The wide, spacious streets could be navigated easily by two or even three carriages at once. On the horizon, faraway mountains created a panoramic backdrop for the resplendent town.
Temples built in honor of a legion of gods and goddesses adorned the main streets of Wyckell. Numerous priests and priestesses in their distinctive gowns, capes, and tunics moved noiselessly between the buildings. Apparently they were here to help the townspeople worship whatever god they chose in whatever way they wished. A series of brothels and taverns were conveniently located beside the temples to make it even easier to indulge in any type of worship you desired. I noticed one temple had a life-sized statue of Apollyon on its steps. Great cries and shouts came spewing from the entrance of the temple as we slowly rode past.
So, when writing your story, if it’s in an unusual environment, you’ll lean more on description to allow readers to see the unique setting; if you’re writing about a place that your readers are familiar with, you’ll need less description.