Walpole sets up an unreliable narrator in an unusual way in this novel through the two Prefaces. He variously disavows, disclaims, and then reclaims the truth and the origin of the story. On this contradiction, the writer Sir Walter Scott quotes a letter from Walpole in his introduction to The Castle of Otranto, in which Walpole explicitly says that he "wished [the novel] to be believed ancient.” Interestingly, Walpole wanted the book to be "believed ancient," but the First Edition Preface itself is not all that believable. This contradiction compromises the reliability of his narrator's position and the information they share.
Walpole also lavishly praises the "original" author of the novel in the First Edition Preface, saying in the same paragraph that:
The beauty of the diction, and the zeal of the author (moderated, however, by singular judgment), concur to make me think, that the date of the composition was little antecedent to that of the impression. [...] Such a work as the following would enslave a hundred vulgar minds, beyond half the books of controversy that have been written from the days of LUTHER to the present hour.
This boastful diction effusively notes the "beauty" of the book. It would seem bizarrely self-important if Walpole admitted to being the sole author, despite his own "zeal" for the novel. The language he uses to describe the potential influence of the book is also strong in a way that might make the audience unsure of his involvement. Who, after all, would seriously say that their novel could "enslave a hundred vulgar minds" and mean it seriously?
Of course, Walpole isn't being serious, but all this speculation does a great deal to separate the "real" author from Walpole himself (even though Walpole is, indeed, the author). The issue of "translation" also contributes to the unreliability of the narrator here, as Walpole's Prefaces make it seem as though the very language of the novel has been changed and tinkered with.
It is not only the framing of the author himself that contributes to the unreliability of the narration in this book. In his introduction to this edition, Sir Walter Scott calls the "origins of The Castle of Otranto a confused welter of conscious and unconscious material." This is because Walpole imbues the novel with the doubt and mystery inherent to medieval stories, compounded by the way he "supplies" a confused European origin for the book. The reader cannot be really sure how much of the "real" story is being reported because the story itself is so melodramatic and unbelievable.
