When I first started writing my book, I had a very small story in mind. I knew who the characters were and what was going to happen - sort of. It wasn't until I sat down and gave my self permission to let go and write whatever I wanted that I had an actual story.
Fiction, while freeing to write, still needs to make sense in your world. I was told this by an editor at a publishing company that was considering my book. The protagonist (main character) still needs a goal and motivation. There needs to be conflict, or there is no reason for the reader to continue the story. If the reader is not invested in the main character and their "quest", they won't want to read on.
Think about Harry Potter. It is a whole new world with mythical creatures, games, food, and every minute detail you can imagine. The best part? It is all made up! BUT, it is believable. There is plenty of conflict, there is a hero and a villain, there are goals and motivation. Without these parts of a story, your main character is just milling about aimlessly. It's no fun when a character gets everything they want, it makes for a very brief and boring story.
Some Tips on Creating Characters:
Change is important: the character's change in attitude, motivation, goals, the "WHY" are they doing that?
Growth throughout the book. Fiction writing is about change.
Drive: Characters want to be happy, but how will they get there? What are they on a search for? Love? Money? Freedom? Power? What is motivating them? They need to care about something and need a reason not to give up.
Character's goals: Main goal is what drives the story, win the guy, get the job, solve the crime, etc.
Then there are minor goals are throughout the story, the smaller goals that get to the main goal: woo the guy, interview for the job, get the clues.
Character Profile/Bio: What do they look like? How old are they? Do they have habits? What do they do for a living? Where do they live? Are they single? Have kids? Religious? If you were to look in their refrigerator right now, what's in it? Organic eggs and four bottles of wine or leftover Chinese food and condiments? What does your character do when no one is watching? When your character is faced with a challenge or crisis, ask yourself what your character wants from the situation, and base their behavior/reaction on the answers you've given to the above.
There are many tips out there on character building and creating believable characters.
I highly recommend the book set Elements of Fiction Writing-check out "Characters and Viewpoint" by Orson Scott Card.
Check these out:
Create a Fictional Character from Scratch
25 Things you should know about Character