Emil Ferris had a feeling she was a monster at an early age. “I was a werewolf,” she says, quite happily. “I had fangs and I was furry.”

Karen, the little werewolf girl at the heart of Ferris’s landmark graphic novel, My Favorite Thing Is Monsters, is clearly inspired by that self-portrait. The character is drawn as an oh-so-cute creature who is vulnerable, optimistic and hirsute. Obsessed by her neighbour’s death, she embarks on an investigation that exposes the grand horrors of political history and the street-level drama of 1968 Chicago. Both strands are filtered through Karen and Ferris’s shared fascination with monstrousness. “The book is a refutation of the idea that the monster is bad,” the 62-year-old author says.

The first volume of My Favorite Thing Is Monsters was published to huge acclaim, winning numerous awards and vaulting the Chicago-based writer and illustrator into the highest pantheon of graphic storytellers. Seven years later, Book Two picks up precisely where the first left off. It’s been a long wait for fans to discover the second half of the story, partly because of Ferris’s choice to do “the most laborious thing in the whole world” – to draw with a pen, each page requiring “thousands of tiny marks”.

Though time-consuming, Ferris says each page she creates is “made with joy and thanks”. She is especially grateful to be able to do the work she does, having previously been paralysed in three limbs after contracting West Nile virus in 2001. At the time, it didn’t seem it would be possible to return to her work as a freelance illustrator and a toy designer, so after recovering some mobility she returned to education. Her aim was to train as a digital animator, “but I found out I was totally crap at that”, she says. When she discovered graphic novels, through Art Spiegelman’s Maus, she “put all the energy [she’d] been using to walk into learning to draw again.” She needed all the help she could get: her six-year-old daughter duct-taped a pen into her hand, while a friend sent money for food. “I was so fortunate,” she says. “I had the grace and kindness of so many people to help get this book out into the world.”

Ferris’s faith in humanity is embedded in every page of My Favorite Thing Is Monsters. Karen grows up in a world of prejudice offset by compassion. It’s a Dickensian gallery of mobsters, sex workers and artists, that the author both recognises and rehabilitates. A repeated theme of the work is the power of art to change the world on a personal and political level. Ferris is inspired by her father, an artist, who was “a tough guy, a guy involved in dark forces in his youth, a bit of a mobster. But who found art and was accepted by that world. And it changed his life.”

For Ferris, there are “good monsters” and “bad monsters”. The good are emblems of individuality, best represented in the book by Karen’s emerging queerness and her brother’s alloy of street smarts and artistic sensitivity. Bad monsters are the “mediocre villagers with pitchforks”, those “always looking to chase that thing within themselves that they’ve lost. That beautiful wild thing that lives in the forest.”

It is not always easy to tell whether Ferris is being mystical or metaphorical. One thing she is clear on, however, is that there are real threats facing art and humanity. “I look at my daughter’s generation and I see them interacting with this small lighted box. My God, I’m terrified for a future experienced through this narrowed vista,” she says. So far, so familiar. But Ferris’s worries are more specific than the usual laments for the pre-digital age. Transhumanism is one of her concerns, CRISPR gene-editing another – “which will force us to reconsider our relationship with Mary Shelley … the genius of our age”.

The core of her anxiety seems laser-focused on a future devoid of individuality and “our glorious human difference”. It’s writ large in the Nazi camps that make up the gruelling focal flashback of Book Two, and duplicated in miniature by Karen’s schoolyard bullies. Ferris does not dilute the horror of either, complete with a sexual threat, which is “one of the many things about the concentration camps that are never really mentioned”.

Social conformity looms as the ultimate “monster” that My Favourite Thing is Monsters is trying to warn against. The book is “about a single individual discovering their inner forces. The inner forces that terrify them and the inner forces that so intrigue them and could potentially heal them,” Ferris says.

Is art that inner force, I ask? She nods enthusiastically. “It’s our heritage and our birthright and we must have it,” she says. “Because we can’t enter a future without our humanity. There’s no point to it.”

• My Favorite Thing Is Monsters Book Two by Emil Ferris is published Fantagraphics (£44.99). To support the Guardian and Observer, order your copy at guardianbookshop.com. Delivery charges may apply.