If Sebastian Barry’s parents had been told, when he was a child, that he would one day be shortlisted for the Booker prize, they would have been astonished. Unable to master reading or writing until he was nine, his gifts, at that stage, did not appear to be literary. None the less, his mind was developing in ways that would later inform the artistic vision which has made him, at 50, one of Ireland’s foremost playwrights and novelists.

Language remains, for Barry, something heard or spoken rather than black marks on a page, and he vividly remembers being read to as a child - “very English things, like Beatrix Potter.”

“Storytelling pre-dates homo sapiens and the technique of writing,” he says. “I can’t actually do anything until I can hear it singing. I’m praised - or maybe blamed - for poetic writing, but it’s really just how I take it down. It’s not a conscious effort, it’s the language of how I hear and see those things.”

If the sound and taste of words is what continues to animate Barry - he’s particularly pleased about the amount of cursing in his latest, Booker-shortlisted novel A Long, Long Way, as “it’s a good salt” - the vivid, concrete nature of his fantasy life is something else he retains from childhood. As a little boy, he used to be terrified that if he didn’t lie in bed visualising the things and people he loved they would cease to exist. For the adult writer, characters are called into existence in an equally intense way: “I had a sense of the fellows allowing me in. And I was trying to hear and see. And I was standing somewhere near them,” he says.

The “fellows” who people A Long, Long Way - the title comes from the popular song “It’s a long, long way to Tipperary” - are servicemen in the first world war, their human fellowship being their only (slim) hope of redemption. The novel has been praised for its powerful battle scenes and for its tender treatment of its hero, Willie Dunne, an Irish 18-year-old who volunteers to fight for king and country only to find himself, while on home leave in Dublin in 1916, ordered to fire on his own countrymen during the Easter Rising. In his naivety, Willie at first assumes the Germans have invaded, but his childlike innocence cannot protect him from the fracturing complexities of Irish history.

The odds offered by the bookmakers suggest he is unlikely to win on Monday, but he was delighted and surprised to have been shortlisted: “It just seemed like a very intense, unlikely dream. I mean, I’m 27 years writing, I’ve noticed the Booker every year for 27 years. It was just magic.” JM Coetzee’s Disgrace, which won the prize in 1999, is among his favourite novels. He read it during a period of unhappiness - his brother was ill, the main actor in his play The Steward of Christendom had died, “and I just needed to be told the point of writing. It’s a book that makes you want to try again.” He kept it by his bed, and it took on talismanic significance.

Much of Barry’s writing has been inspired by his family’s past, and both his grandfathers were hugely influential. From his mother’s father, a major in the British Army, he imbibed stirring tales of empire and the North-west frontier. In contrast, his father’s father, a watercolourist and art teacher, was a fervent nationalist, who saw it as his duty to teach himself Irish, yet who nevertheless married the daughter of a policeman, whom he regarded as one of the chief officers of British imperialism. Barry is Catholic on both sides, but, he says humorously, “I took the precaution of marrying a Protestant.” Barry’s sense of multiple, shifting identity, derived from this background of mixed allegiances, seems to underlie his belief in the necessity of reconciliation, a recurring theme in his work.

Barry’s plays and novels are themselves interconnected by family ties. Willie Dunne in A Long, Long Way has appeared before: he is the son of Thomas Dunne, the ex-superintendent of the Dublin Metropolitan Police, based on the writer’s great-grandfather, who is the embittered protagonist of The Steward of Christendom, the 1995 play which was Barry’s first big international hit. Most of Barry’s work is set in the past. When he tried using more contemporary material, in his play Hinterland, about a corrupt Irish politician who was simplistically identified in the press as Charles Haughey, he suffered a painful media backlash. “I don’t know how I got through that time. I was like a fox trapped in a fence, suddenly realising that these hounds chasing me actually wanted to kill me,” he told The Irish Times.

It was, perhaps, inevitable that Barry should write for the theatre. His mother, Joan O’Hara, is a former actress. The reason he saw so much of his grandfathers as a child was because she was frequently away performing. The theatre gripped his imagination, delighting and discomforting him with its shape-shifting, but he also seems to have felt some resentment at his mother’s absence. (It is perhaps significant that his wife Alison, also an actress, gave it up to care for their three children.) Barry particularly remembers being taken to Yeats’s Cathleen ni Houlihan as a child. “The curtains open, the light pours on to the stage, and there they are. An old, old woman talking in a way that reminds me of the country, of Wicklow. At the end they say she’s an old woman but she has the gait of a girl, and I suddenly realise that it’s my mother. And I thought, what’s going to happen now?”

As a young man he wrote poetry, and read Ezra Pound. “It’s sometimes forgotten how important Pound was to Yeats; he tried to modernise Yeats,” he says. “Yeats was constantly trying to reinvent himself, he was the Madonna of Irish literature.” Barry then produced what he describes as impenetrable “Houdini fiction”, but finally decided to write a play to pass the time while his wife was away filming Casualty. Instead of introspection, this gave him the chance to “write about other people for their sake and put them back in the world.” Paradoxically, it was by cutting out his own authorial presence that he found himself, and Boss Grady’s Boys earned him a respectful welcome from fellow playwrights. He cites Thomas Murphy’s The Gigli Concert, which he saw in 1983, as an influence, naming it along with Brian Friel’s Faith Healer and Frank McGuinness’s Observe the Sons of Ulster Marching Towards the Somme as among the most important 20th-century Irish plays. “I saw it as a rather innocent, befuddled, youngish person, definitely a late developer, I didn’t know what the play was about but I knew after seeing it that it was possible to write something extremely wild and survive,” he says.

Barry is now equally at home in drama or fiction. Genre tends to be dictated by the nature of the characters. His critically acclaimed novel The Whereabouts of Eneas McNulty (1998) - about a naive young man who enlists in the Royal Irish Constabulary after the first world war, only to be forced into exile after finding himself on an IRA hitlist - began as a play. It turned into a novel because the protagonist was not articulate enough credibly to sustain monologues.

The novelists Barry most admires tend to be 19th-century: Thackeray, Trollope, Conrad. He singles out the latter’s Victory, which he read just as he was leaving Trinity and on his way to Paris - “everything James Joyce did you had to do it too” - which made an impression “maybe because I was so neurotic and delighting in feeling quite doomed, at the end there’s a wonderful image of the burning bed, so I carried it around.” Another Victorian writer comes up when he describes his childhood in a large, 19th-century house by the sea in Monkstown. “I had a pang of recognition when I read about the Tennysons’ eccentric household. Ours was a very isolated life. Not only did people not come to the house, but we rarely met each other. You’d meet your father on the stairs and almost shake hands and introduce yourself.”

This description could not contrast more with the warm and settled home that Barry and his wife Alison, now a scriptwriter, have made for themselves and their children in an isolated spot in the Wicklow mountains a couple of hours from Dublin. This part of the country has always inspired affection in Barry - his charming novel, Annie Dunne (2002) draws on his childhood visits to his great-aunt there.

The house, which they bought as a near ruin, is an old Church of Ireland rectory. Built in 1811 of rough-hewn stone, its almost fortified appearance suggests how embattled the early occupants must have felt. Yet there is nothing forbidding about the atmosphere there now. A turf fire burns hospitably in the grate. The house resounds with the echoes of children, laughter, and two handsome, close-cropped standard poodles, one black, one white, that seem to be posing for a picture by Stubbs.

Despite the fact that issues of Irishness inform his writing so powerfully, Barry’s own political consciousness came late. The Dublin bombings of 1974, which happened while he was a student, traumatised him, and he ran away to France and Greece. “All over the city, people were suffering terrible wounds. It came home to me that there were people willing to inflict utter physical distress on each other. Our people - we’re Irish - and we’re doing it to each other. You make an identification with them as if you’re doing it yourself. I wanted to get away to a place where I wasn’t doing it, which was actually very selfish and small-minded of me. People have slightly forgotten about those bombings now, but I will certainly never forget.”

The need to remember is something that particularly informs A Long, Long Way. Barry feels the fact that so many Irishmen volunteered for the first world war - some out of hope that winning would result in home rule, others out of Unionist sympathies - has until recently been marginalised by historians keen to create a simplistic nationalist story. In doing so, he has been accused of right-wing revisionism and political naivety, charges that his friend, historian Roy Foster, who has been similarly accused, vehemently denies. For Foster, Barry’s vision offers a true “commitment to understanding rather than judgment”. Barry returns the compliment, crediting Foster with having helped him to understand his own work.

Understanding does not, however, bring any easy answers, and Barry’s view of history remains fatalistic. “There’s a sort of despair that comes out of an absolute love of people. This is how things are. Whatever water you throw at the fire, it just turns into steam. But that doesn’t mean you should stop throwing it. The dance of it is important.”