A large body of research consistently found cultural differences in cognition between Westerners and East Asians. We undertook a study to explore whether culture-specific thinking models may influence how German and Chinese children understand fairy tales. By transferring the established theoretical framework of individualism versus collectivism from cultural psychology to literary studies, we hypothesize that readers in western Europe prefer an individualistic-oriented thinking model for character evaluation, adventurous attitude to plot development, as well as concrete time and spatial perception; by contrast, their counterparts in East Asia use social-oriented interpretation styles for character judgment, a self-restrained attitude towards plot development, and a symbolic time and spatial imagination. The method we used relies on questionnaires, item-based analysis and factor analysis to learn about the most salient dimensions for cross-cultural story comprehension. We found differences in all three dimensions of story comprehension, namely character evaluation, plot development, and time/space imagination. The results reveal how culture shapes the way we read and point to the important role of embedded schematic knowledge for story comprehension.