This study aims to uncover (1) the challenges to foster literacy culture in the digital era, (2) the value of literacy conveyed through fairy tales, (3) the role of fairy tales for literacy and numeracy, and (4) the outcomes observed in literacy and numeracy development through fairy tales. The research used the qualitative approach with the case study method. Interviews, observations, and documentation were employed as data collection techniques. The collected data were analyzed through data collection, data reduction, data presentation, and drawing conclusions. The research results show that (1) the challenges of literacy culture in the digital era starts with finding and evaluating; (2) the literacy value conveyed through fairy tales includes literacy values encompassing listening, speaking, reading, and writing, while the value of numeracy includes skills in symbols and number, information analysis, and problem solving; (3) the role of fairy tales is as a medium to capture student's attention. Fairy tales provide entertainment and moral teachings, which are engaging young learners since most children today prefer to see images rather than text. Therefore, the role of fairy tales is considered as a tool to enhance literacy among children.