The aim of this study is to understand contextual conditions of Turkish Folktale in Ercis province. There is a very strong folktale tradition in the province. It is thought that the reason of this very rich and strong tradition is related to contextual factors. In this research it is found that divanhane tradition has a very important role in this folktale tradition of the province. It is the one of the very important institution that "creates and sustains oral literature opportunity" in the region. At the same time it is seen that divanhane as an institution has different roles in social structure during research process. Divanhane is the institutional structure for folk-tales and stories performance. In the region it has been found that they contribute oral literature and sustain them. But after 1970's this tradition and its culture lost impact in the social life. The specifically technological development and change of life style of people affect the impact of this institution in community. Today we only know that people have such culture from the history. It is also very important that this tradition should be included in UNESCO Intangible Cultural Heritage Representative list of Turkish traditional chat meetings. For this reason it is necessary to make research in detail about divanhane tradition in the region. In this process there are opportunities to reach tale sources of region. Particularly finding storytellers; listening and collecting the tales and stories that performed in divanhane are very important.