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This thesis explores how contemporary Muslim novels shed light on the diverse experiences of Muslims within the modern world-system of capitalist modernity, while also asking how we can read Muslim literary productions without succumbing to Orientalist stereotypes regarding Islam and Muslims. Through a comparative close reading of six novels written since 1980 and set in six different countries, the thesis examines how contemporary Muslim writers make use of a popular genre (magical realism), and draw on Islamic traditions (especially Sufism), as well as local myths and forms, to engage with the pressures of modernity, as they are experienced in their own communities. This thesis extends the notion of a world literary system developed by scholars such as Pascale Casanova, Franco Moretti, and the Warwick Research Collective (WReC), in a manner that also rejects essentialist ideas of a fixed Muslim identity, as well as a singular literary form or mode. By comparing different Muslim magical realist texts, the thesis complicates the idea that the magical realism of Salman Rushdie, for example, is a normative model for other Muslim writers. While I broadly agree with critics that magical realism has become a global genre, I argue that a comparison of magical realisms from across the Muslim world can help us to think in more nuanced ways about the relationship between literature, religion, and modernity.