At least, I thought so however many years ago when it first came out. It's still a flippin' awesome game in my book and I'm really excited about starting a brand new Fable: TLC profile on my Xbox 360 but I'm afraid that one or two other games have overthrown Fable: The Lost Chapters in my top games list.
I consider Oblivion up there, dunno if I like it better than Fable, though. I've probably clocked up more hours on Fable than I have Oblivion. I'd still rank Fable: The Lost Chapters higher than games like, say, Call of Duty 4 and Devil May Cry 4, though.
Nothin' comes close to the awesomeness that is Shining Force for the Sega Mega Drive, though. Just... wow.
It's not Heroes 3 so no! Actualy, not even my favourite RPG because Fallout and Arcanum are just to good. But as an ActionRPG or Adventure/RPG it may be one of the best, don't know many other in that action rpg beside Sudeki and Jade Empire and Fable has much better combat than both of them. Maybe some more puzzles and choises and consequence and the game would be pure gold