The influence of the versions of The Nights on world literature is immense. Writers as diverse as Henry Fielding to Naguib Mahfouz have alluded to the collection by name in their own works. Other writers who have been influenced by the Nights include John Barth, Jorge Luis Borges, Salman Rushdie, Orhan Pamuk, Goethe, Walter Scott, Thackeray, Wilkie Collins, Elizabeth Gaskell, Nodier, Flaubert, Marcel Schwob, Stendhal, Dumas, Gérard de Nerval, Gobineau, Pushkin, Tolstoy, Hofmannsthal, Conan Doyle, W. B. Yeats, H. G. Wells, Cavafy, Calvino, Georges Perec, H. P. Lovecraft, Marcel Proust, A. S. Byatt and Angela Carter.
Various characters from this epic have themselves become cultural icons in Western culture, such as Aladdin, Sinbad and Ali Baba. Part of its popularity may have sprung from improved standards of historical and geographical knowledge. The marvelous beings and events typical of fairy tales seem less incredible if they are set further "long ago" or farther "far away"; this process culminates in the fantasy world having little connection, if any, to actual times and places. Several elements from Arabian mythology and Persian mythology are now common in modern fantasy, such as genies, bahamuts, magic carpets, magic lamps, etc. When L. Frank Baum proposed writing a modern fairy tale that banished stereotypical elements, he included the genie as well as the dwarf and the fairy as stereotypes to go.
In 1982, the International Astronomical Union (IAU) began naming features on Saturn's moon Enceladus after characters and places in Burton's translation because “its surface is so strange and mysterious that it was given the Arabian Nights as a name bank, linking fantasy landscape with a literary fantasy”.
In Arabic culture
There is little evidence that the Nights was particularly treasured in the Arab world. It is rarely mentioned in lists of popular literature and few pre-18th century manuscripts of the collection exist. Fiction had a low cultural status among Medieval Arabs compared with poetry, and the tales were dismissed as khurafa (improbable fantasies fit only for entertaining women and children). According to Robert Irwin, "Even today, with the exception of certain writers and academics, the Nights is regarded with disdain in the Arabic world. Its stories are regularly denounced as vulgar, improbable, childish and, above all, badly written." The Nights have proved an inspiration to some modern Egyptian writers, such as Tawfiq al-Hakim (author of the Symbolist play Shahrazad, 1934), Taha Hussein (Scheherazade's Dreams, 1943)  and Naguib Mahfouz (Arabian Nights and Days, 1981).
Possible early influence on European literature
Although the first known translation into a European language only appeared in 1704, it is possible that the Nights began exerting its influence on Western culture much earlier. Christian writers in Medieval Spain translated many works from Arabic, mainly philosophy and mathematics, but also Arab fiction, as is evidenced by Juan Manuel's story collection El Conde Lucanor and Ramón Llull's The Book of Beasts. Knowledge of the work, direct or indirect, apparently spread beyond Spain. Themes and motifs with parallels in the Nights are found in Chaucer's The Canterbury Tales (in The Squire's Tale the hero travels on a flying brass horse) and Boccaccio's Decameron. Echoes in Giovanni Sercambi's Novelle and Ariosto's Orlando furioso suggest that the story of Shahriyar and Shahzaman was also known. Evidence also appears to show that the stories had spread to the Balkans and a translation of the Nights into Romanian existed by the 17th century, itself based on a Greek version of the collection.
Western literature from the 18th century onwards
The modern fame of the Nights derives from the first known European translation by Antoine Galland, which appeared in 1704. According to Robert Irwin, Galland "played so large a part in discovering the tales, in popularizing them in Europe and in shaping what would come to be regarded as the canonical collection that, at some risk of hyperbole and paradox, he has been called the real author of the Nights." The immediate success of Galland's version with the French public may have been because it coincided with the vogue for contes de fées ("fairy stories"). This fashion began with the publication of Madame d'Aulnoy's Histoire d'Hypolite in 1690. D'Aulnoy's book has a remarkably similar structure to the Nights, with the tales told by a female narrator. The success of the Nights spread across Europe and by the end of the century there were translations of Galland into English, German, Italian, Dutch, Danish, Russian, Flemish and Yiddish. Galland's version provoked a spate of pseudo-Oriental imitations. At the same time, some French writers began to parody the style and concoct far-fetched stories in superficially Oriental settings. These tongue-in-cheek pastiches include Anthony Hamilton's Les quatre Facardins (1730), Crébillon's Le sopha (1742) and Diderot's Les bijoux indiscrets (1748). They often contained veiled allusions to contemporary French society. The most famous example is Voltaire's Zadig (1748), an attack on religious bigotry set against a vague pre-Islamic Middle Eastern background. The English versions of the "Oriental Tale" generally contained a heavy moralising element, with the notable exception of William Beckford's fantasy Vathek (1786), which had a decisive influence on the development of the Gothic novel. The Polish nobleman Jan Potocki's novel Saragossa Manuscript (begun 1797) owes a deep debt to the Nights with its Oriental flavour and labyrinthine series of embedded tales.
The Nights was a favourite book of many British authors of the Romantic and Victorian eras. According to A. S. Byatt, "In British Romantic poetry the Arabian Nights stood for the wonderful against the mundane, the imaginative against the prosaically and reductively rational."  In their autobiographical writings, both Coleridge and de Quincey refer to nightmares the book had caused them when young. Wordsworth and Tennyson also wrote about their childhood reading of the tales in their poetry. Charles Dickens was another enthusiast and the atmosphere of the Nights pervades the opening of his last novel The Mystery of Edwin Drood (1870).
Several writers have attempted to add a thousand and second tale, including Théophile Gautier (La mille deuxième nuit, 1842) and Joseph Roth (Die Geschichte von der 1002. Nacht, 1939). Edgar Allan Poe wrote "The Thousand and Second Tale of Scheherazade" (1845). It depicts the eighth and final voyage of Sinbad the Sailor, along with the various mysteries Sinbad and his crew encounter; the anomalies are then described as footnotes to the story. While the king is uncertain—except in the case of the elephants carrying the world on the back of the turtle—that these mysteries are real, they are actual modern events that occurred in various places during, or before, Poe's lifetime. The story ends with the king in such disgust at the tale Scheherazade has just woven, that he has her executed the very next day.
Modern authors influenced by the Nights include James Joyce, Marcel Proust, Jorge Luis Borges and John Barth.
Stories from the One Thousand and One Nights have been popular subjects for films, beginning with Georges Méliès's Le Palais des Mille et une nuits in 1905.
The critic Robert Irwin singles out the two versions of The Thief of Baghdad (1924 version directed by Raoul Walsh; 1940 version produced by Alexander Korda) and Pier Paolo Pasolini's Il fiore delle Mille e una notte, 1974) as ranking "high among the masterpieces of world cinema." Michael James Lundell calls Il fiore "the most faithful adaptation, in its emphasis on sexuality, of The 1001 Nights in its oldest form."
UPA, an American animation studio, produced an animated feature version of 1001 Arabian Nights featuring the cartoon character Mr. Magoo. A 1969 One Thousand and One Arabian Nights animated feature film was produced in Japan. Directed by Osamu Tezuka and Eichii Yamamoto, the 1969 film featured psychedelic imagery and sounds and erotic material intended for adults.
Alif Laila (The Arabian Nights) was a 1997–2002 Indian TV series based on the stories from One Thousand and One Nights. It was produced by Sagar Entertainment Ltd. The series starts with Scheherazade telling her stories to Shahryar, and contains both the well-known and the lesser-known stories from One Thousand and One Nights.
A two-part Television mini series was adopted in 2000 for BBC and ABC studios. Arabian Nights starred Mili Avital, Dougray Scott, John Leguizamo, based on the translation by Sir Richard Francis Burton and directed by Steve Barron.
In 2012, Vancouver-based Big Bad Boo Studios produced a 1001 Nights animated television series for children, which was created by Shabnam Rezaei and Aly Jetha. The show launched on Teletoon and airs in 80 countries around the world, including Discovery Kids Asia.
The Nights has inspired many pieces of music :
- François-Adrien Boieldieu: Le calife de Bagdad (1800)
- Carl Maria von Weber: Abu Hassan (1811)
- Luigi Cherubini: Ali Baba (1833)
- Peter Cornelius: Der Barbier von Bagdad (1858)
- Ernest Reyer: La statue (1861)
- C. F. E. Horneman (1840–1906), Aladdin (overture), 1864
- Nikolai Rimsky-Korsakov : Scheherazade Op. 35 (1888) 
- Dikran Tchouhadjian (1837–1898), Zemire (1891)
- Henri Rabaud: Mârouf, savetier du Caire (1914)
- Carl Nielsen, Aladdin Suite (1918–1919)
- Renaissance: Scheherazade and Other Stories (1975)
- Fikret Amirov: Arabian Nights (Ballet, 1979)
- Icehouse: No Promises (From the album 'Measure for Measure' 1986)
- Ezequiel Viñao, La Noche de las Noches (1990)
- Carl Davis, Aladdin
- Kamelot, Nights of Arabia (1999)
- Sarah Brightman, Harem and Arabian Nights (2003)
- Ch!pz, "1001 Arabian Nights" (2004)
- Nightwish, Sahara (2007)
- Abney Park (band), Scheherazade (2013)
Popular modern video games with an Arabian Nights theme include Nadirim, a game placed in a fantasy world inspired by the tales of the 1001 Nights, and Sonic and the Secret Rings.
Many artists have illustrated the Arabian nights, including: Pierre-Clément Marillier for Le Cabinet des Fées (1785–1789)Gustave Doré, Léon Carré (Granville, 1878 – Alger, 1942), Roger Blachon, Françoise Boudignon, André Dahan, Amato Soro, Albert Robida, Alcide Théophile Robaudi and Marcelino Truong; Vittorio Zecchin (Murano, 1878 – Murano, 1947) and Emanuele Luzzati; The German Morgan; Mohammed Racim (Algiers, 1896 – Algiers 1975), Sani ol-Molk (1849–1856), Anton Pieck and Emre Orhun.
Famous illustrators for British editions include: Arthur Boyd Houghton, John Tenniel, John Everett Millais and George John Pinwell for Dalziel's Illustrated Arabian Nights Entertainments, published in 1865; Walter Crane for Aladdin's Picture Book (1876); Albert Letchford for the 1897 edition of Burton’s translation; Edmund Dulac for Stories from the Arabian Nights (1907), Princess Badoura (1913) and Sindbad the Sailor & Other Tales from the Arabian Nights (1914). Others artists include John D. Batten, (Fairy Tales From The Arabian Nights, 1893), Kay Nielsen, Eric Fraser, Errol le Cain, Maxfield Parrish, W. Heath Robinson and Arthur Szyk (1954).