The Prince and the Pauper has a mythical, whimsical mood, supported by its rich imagery and realistic dialogue.
The romantic, visually and sonically rich descriptions throughout The Prince and the Pauper help create a fairy tale atmosphere. Consider this description of Edward wandering late at night in Chapter 18:
Occasionally, he caught the twinkle of a light—always far away, apparently—almost in another world [...] the muffled lowing of the herds floated to him on the night wind in vanishing cadences, a mournful sound; now and then came the complaining howl of a dog over viewless expanses of field and forest [...] he stood solitary, companionless, in the middle of a measureless solitude.
The shimmer of far-off lights, the dark expanses of quiet fields, the calling of the dogs and herds “float[ing]” to the little prince in “vanishing cadences,” all evoke an ethereal mood. The description feels more like a painting, or a scene in a film, than a realistic portrayal of a cold, wet night in the English countryside (especially one on which the protagonist is lost, with no way home). Even at this point of high danger in the narrative, Twain produces scenes with fine, delicate details that make that danger seem less real, more make-believe.
The dialogue in the story, however, is relatively close to real speech from the 16th century (some of it taken directly from roughly contemporaneous sources, like Richard Head’s The English Rogue). Twain’s choice to imitate the diction of this era actually makes the story feel more mythical, like a romance of the era (perhaps because this speech is so unlike that of the reader's time). Much of the slang and many of the allusions throughout the book (the thieves’ cant, the palace lingo, the references to London’s geography and religious figures) work in tandem with the diction to produce speech totally foreign to young readers. The language, word choice, and diction are so faithful to the period that they estrange the reader, and transport the reader to another, long-dead era.