String white twinkling lights through trees, brushes or over railings. They're elegant and will make the place feel magical at night. You can also pull cool white twinkle lights through baskets and fill them with dried flowers, books or pine cones.
Add a few wind chimes in trees to create a magical sound when the wind blows.
Find a backyard firepit with a copper or black stand. It'll add instant magic. Circle it with black, wrought-iron chairs and light a fire that people can sit around on cool evenings. A stone firepit with stone seats can also bring a bit of earthy magic into a backyard.
Plant beds of bright flowers that ramble through your garden. Purple, blue, yellow, orange, red and pink glowers that cover a lot of the ground will make the place seem like a fairyland. Create stone stepping paths through the flowerbeds before you plant them so you can walk through and smell the scents.
Put a pond or fountain in your backyard. These can work for all budgets -- from a small fountain with an actual stone fairy to a full-on pond created in the ground. An alternative is a birdbath which will attract birds to sing in your backyard fairyland.
Place statues or trellises in the backyard to add characters or settings for your own personal fairytale. A princess has kissed a frog more than once in popular fairytales, so set a stone fairy near a stone frog to give them another chance.