A circus boat, a flooded earth and two women with secrets: these are the key factors in Kirsty Logan's first novel, The Gracekeepers.

This modern fairytale has moments of exceptional insight and thrilling action, and others where a little human touch would be welcome.

Logan imagines a partially submerged world where only scattered archipelagos remain. There's a war on between damplings and landlockers; terms coined by Logan to characterise the class divide. Damplings float in ramshackle boats and must shamefully wear a bell while on land. Landlocker families inherited their luxurious dwellings and despise the ocean so strongly that seafood never passes their lips.

But the novel focuses on the wetter and less privileged. We meet the Circus Excalibur, a nomadic crew of misfits who perform for food. The circus has an unlucky 13 members including clowns, acrobats, the ringmaster Red Gold and his wife Avalon. Most important is our heroine North, whose party piece is a waltz with her beloved pet, a sleepy brown bear. Logan imagines them as having an interdependent relationship, as both girl and bear grew up as orphans. One wishes that the nameless bear played more than a side role, as he is a furry and friendly presence, especially for North: "It wasn't until she slid under her bear's sleeping paw that she felt her heart slow."

Paralleling the circus is the story of Callanish, a gloomy gracekeeper presumably named after the famous standing stones. Her role in life is to bury the deceased in a ceremony known as a resting, another of Logan's imagined terms. She lives a hermetic existence in the ocean as penance for a past sin. Her secret is her amphibious deformity; the webbed hands and feet she hides with silk gloves and slippers. North and Callanish meet after a circus member drowns in a bad storm. Logan paints them as timid, would-be lovers, as Callanish is also "an outcast, just like circus folk". The way in which the two women's lives become entwined motivates the novel's second half, though their mutual reserve dulls their scenes and one wishes for livelier dialogue.

This book begs to be seen as a contemporary fable and Logan drops heavy hints. She plays with opposites: dark and light, land and sea, the supernatural and the everyday. For instance, Avalon is a manipulative stepmother whom we first meet chewing a bright green apple. Handsome Ainsel is a blond Prince Charming type marrying North to please his father. And North secretly becomes impregnated by a mystical sea-swimmer who is "not a man, not a woman. In the dim light of the stars she saw the silvery gleam of scales." It's an odd dose of magic and a future development in the story makes one wonder if the strange pregnancy is a metaphor for in vitro fertilisation.

As with many fairytales, there are lessons to be learned. The clearest one is that everyone pretends to be something they're not. Callanish pretends to mourn the dead at her resting ceremonies, confessing that she only "mimes grief". North and Ainsel pretend to be in love for Red Gold's sake, with Ainsel bravely stating, "We'll get married, and we'll get our house, and we'll live happily ever after. That's the only ending." And Logan creates an acrobat troupe called the Glamours, who float in and out of the action. These performers cover themselves in bright make up to look female from one angle and male from another, adding a sense of illusory beauty. That people constantly hide their identity in order to please or trick others seems to be this novel's blunt message.

Logan is an ambitious young writer who has enthusiastically assumed the role of a storyteller. Some passages in the novel are outstanding, illustrating a sensitive feel for the ocean and the taut suspense of high-wire circus acts. She also has a knack for conveying buried tension, seen in the way she describes North waking up: "Dreams were still caught on the insides of her eyelids..." Logan's controlled writing style generally suits the relatively narrow limits of the fairytale genre.

But occasionally it's hard to relate to these prescribed characters, so clearly heroes or villains, whose rigid speech seems to lack a sense of freedom or individuality. Despite the constant water imagery, the story's pool of emotions could be deeper.