In the mid-1920s, a legendary young writer wrote the most uncannily brilliant slice of Surrealist fiction ever to appear in English. At one point, its narrator hears about a time-bending premonition of a train crash, with a track-side vision of "a horned sheep and two swans". A long lifetime later, in October 1996, a very elderly ex-schoolmaster composed an eerie tale of late-flowering love. At its close, a rich widow moves into a costly old-age home with "a marvellous view of trees beyond which swans could be seen swimming on a blue sky-reflecting lake".

Time, in the writer's imagination, may bend, flow, loop or even dance (vide Anthony Powell, born in 1905). To the swan-haunted Edward Upward (born in 1903, and author of both those stories) time has moved not in a circle but a spiral. Miraculously, the student genius who entranced young Auden, Isherwood and Spender publishes a fresh volume of fiction this month. Five of Upward's recent stories appear from Enitharmon Press as The Scenic Railway (pounds 6.99).

The great 1920s fantasy - a chunk of the "Mortmere" dream-world Upward and Isherwood co-created - bore the title "The Railway Accident". We can assume that Upward (who for 30 years taught English at Alleyn's School in Dulwich) wants to make the connection. That's an event in itself, for the textbook version of his career tells of a unique voice - an English Kafka - that stifled its talent in what John Lehmann once called "the Iron Maiden of Marxist dogma".

Upward joined the Communist Party in 1932 and gradually gave up fiction for activism. In 1948, he forsook the Party in disgust - from a far-left, not a reformist position. After retirement, he decanted his dilemmas into a remarkable fictional trilogy, The Spiral Ascent. Through the stories that ensued, as Upward neared extreme old age, the magician and the militant have edged towards a truce.

In The Scenic Railway's title story, an amusement-park ride leads past tragic tableaux of modern history until veteran radical Leslie drops down a time-hole into his suburban boyhood. As a painter of hallucinatory dreamscapes - a kind of prose Magritte - Upward at his finest still has no peer. In bright patches, that gift endures right up to the grotesquely funny sketch of a prewar Rouen pension in the 1996 story, "Emily and Oswin".

It is extraordinary to have strong new work from a figure first mythologised in 1938, in Isherwood's Lions and Shadows. Critics will wonder how much more we could have enjoyed had hard politics not shunted his unsettling imagination down a single track. But to think thus is to wish that we'd been spared the heartbreak of our history - tempting, but futile. As the time-travelled Leslie yearns to tell his parents, "the life he had chosen had been the only tolerable one for him".