I am trying to think of the title of a great fantasy novel I read in the 1980's. The plot is a little fuzzy - the adult son of a very famous and beloved author realizes that he has found the rather surreal town and characters his father created -- essentially that his father was such an incredible writer with such a vivid imagination that his books have become reality in this one place. I believe that the town was in the midwest somewhere. Some of the characters were rather odd - imagine Lewis Carroll with a darker bent. I believe he starts an affair with one of the townspeople, and things turn VERY dark when it's revealed the characters believe he has the power to keep creating and expanding his father's work, and they try to keep him in the town. The cover art features one or two bull terriers -- they are among the creations and I think they can talk? The novel ends with him back home, slightly crazy, waiting to kill one of the creations who has followed him home and is about to turn the corner. The I think the title has the word "laughing" or "laughed" in it. I'd love to read this again and pass it on to my kids -- Please help!
I think it may be Land of Laughs by Jonathan Carroll. Not a perfect match, but pretty good. The dating is about right, as is the "laughs".
From Wikipedia (https://en.wikipedia.org/wiki/The_Land_of_Laughs):
In a used book store, Thomas Abbey, an avid fan of Marshall France, a deceased writer of unique children's books, has a chance encounter with Saxony Gardner, another enthusiast of that reclusive man. Together, they set out to the fictitious town of Galen, Missouri, to meet Anna France, the writer's daughter, in order to obtain her permission to write Marshall France's biography. Prepared for rejection, they are warmly welcomed and settle into the community and their literary endeavor.
However, they find an uncanny resemblance between the town of Galen and its inhabitants, and the literary world of their idol. Figures from Marshall France's books are alive in Galen, and Thomas and Saxony begin to question if the books were patterned on Galen, or if the writer's magic created Galen. Equally disturbing is Thomas' role as biographer, who appears to create reality by his writing, and begins to question the motives of Anna and the inhabitants of Galen. Events reach a crisis point when Thomas' biography reaches the time of Marshall France's arrival in Galen.