Perhaps there is no Jewish NARNIA, and that remains an arguable point, but I think some of Bernard Malamud's work comes quite close to fantasy (for adult readers). To cite just one example, consider THE NATURAL. Other readers, I am sure, can cite other examples (other stories and other writers).
Postscript: Consider also Malamud's THE MAGIC BARREL. (Note: As you can tell, I am a big fan of Malamud!)
How quickly they forget:Isaac Bashevis Singer: the collected storiesLisa Goldstein: The Golem; among other booksand several other Jewish fabulists. (And Malamud, of course.)The reason there's no equivalent to Narnia is of course because Narnia is a fundamentally Christian allegory; Aslan is a savior figure. If one is looking for Jewish equivalents of this sort of fantasy or magic-realist type of writing, then Jewish writing is full of them. Even the Rabbinical folktales would fit under this umbrella.
Not to mention some of Chaim Potok's best work.It really is a long list, after all.
Consider also Kafka. Yes, I know he rather rejected identification with his Jewish identity, but his works nonetheless are very much influenced by his fascination with medieval Jewish mysticism and Kabalah, and much of his work is dark fantasy.However, Art makes a very important point about Narnia as Christian symbolism. Build upon that point and you find Jewish symbolism is a tremendous amount of very important literature--secular and nonsecular.
Michael Weingrad replies to "three of [his] most thoughtful critics, Abigail Nussbaum on her blog, Ross Douthat at The New York Times, and David Goldman of First Things":"No Jewish Narnia's: A Reply"http://www.jewishreviewofbooks.com/publications/detail/no-jewish-narnias-a-reply
Dave, thanks for the link. In reading it, I sense a lot of self-justification.It seems obvious to me, who had read more than a bit of the genres involved while the essay's author admits he has not, that his initial questions—why are there no high fantasies of the Lewis or Tolkein type written by Jews and set in Jewish mythology—show a fixation on one type of genre that completely overlooks others. Many examples were given him.Many of the examples are more like magic realism than high fantasy; yes, they do tend to be more existential than mythological, but that's sort of the point about the fundamental differences between Judaism and Christianity, and describes those differences rather well.