Like Nick, Gatsby comes from the Midwest (North Dakota, although his father later comes from Minnesota). Early in the book, he is established as a dreamer who is charming, gracious, and a bit mysterious. As the story unfolds, however, the reader learns more and more what precipitates the mystery: that everything he has done in his adult life has been with the sole purpose of fulfilling the most unrealistic of dreams — to recapture the past. Gatsby is in many ways, as the title suggests, great, but when looking at him critically, some of the things he stands for may not be so admirable.
In one sense, Gatsby's rags-to-riches success story makes him an embodiment of the American dream. He started life with little, as the son of fairly unsuccessful farmers. By the time he was a young man he had even less, having voluntarily estranged himself from his family, unable to come to terms with the lot he had been dealt in life. While on his own, he had the opportunity to reinvent himself, and due solely to his own ingenuity, Jimmy Gatz evolved into Jay Gatsby. As such, life became much different (although he was missing one key ingredient: money). He was no longer tied to his early years, but could imagine whatever past for himself he desired. And then he fell in love, a fateful incident that would change the course of his life forever. After meeting Daisy, everything he did was for the singular purpose of winning her. Money was, essentially, the issue that prevented their being together, and so Gatsby made sure he would never again be without it. Gatsby's drive and perseverance in obtaining his goal is, in many senses, commendable. He is a self-made man (in all respects) and as such, is admirable.
However, all positive traits aside, there are aspects of Jay Gatsby that call into question that admiration. Gatsby's money did not come from inheritance, as he would like people to believe, but from organized crime. The story takes place during the time of prohibition and Gatsby has profited greatly from selling liquor illegally. In addition, while people come to Gatsby's parties in droves, he really knows very little about them. In fact, he doesn't want to know much about them, just whether they know Daisy. Finally, Gatsby's friendship with Nick really begins to blossom only after he finds out that Nick is Daisy's cousin.
In assessing Gatsby, one must examine his blind pursuit of Daisy. Everything he does, every purchase he makes, every party he throws, is all part of his grand scheme to bring Daisy back into his life for good. In one sense, this is a lovely romantic gesture, but in another sense, it perpetuates a childish illusion. By being so focused on his dream of Daisy, Gatsby moves further and further into a fantasy world. His inability to deal with reality sets him outside the norm and, eventually, his holding on to the dream leads to his death. By the end of Chapter 7, Gatsby is standing guard outside of Daisy's house on a needless vigil. He is completely unable to realize that his dream is not a reality and so stands watching for a sign from Daisy. He sees what he is doing as noble, honorable, and purposeful. The reader, however, sees the futility of his task as he becomes a parody of his former self. Gatsby is, quite literally, fatally idealistic. He can't wait to distance himself from his past in terms of his family, but yet he lives his adult life trying to recapture the past he had with Daisy. What makes matters worse, too, is that he is in love with the idea of Daisy, not Daisy as she herself is.