Would it be appropriate to put this fan art in a portfolio?

You can put anything in your portfolio that showcases your skill.
That said, she has really tiny legs.

Sure you can.

Totally agree with @ragingloli

Perhaps you can bring her head more toward the foreground and that way her legs would look more believable. (technically speaking) great work otherwise

I would think having a wide variety of work would help showcase the breadth of your talents. You never know what people are looking for and this image might lead to other opportunities. I’m not an expert by any means, but I was impressed. I would explain the challenge you were given in the description so people understand the context.

@pleiades @ragingloli I tried to fix it. Better?

It counts big time towards your talent, creativity and stylization capabilities. What you show there it is obvious you could duplicate what ever they need you to but true forward momentum in a company is by those that can implement new amazing images….you seem to have that ability. Don’t ever shy from showing your full potential.

Just a bit of an update: My entry was a top 50 semi finalist out of 4,655 entries. While I didn’t win the contest, that counts as portfolio ready right? lol, I just added it.

If you didn’t put it in it would be a shame. I never saw the tiny legs, I guess, cause she looks proportional to me. It definitely showcases talent and creativity. Variety is the spice of any portfolio. Every viewer sees each piece differently, so the more variety the better.
Congrats on the high placement. I would say it is well deserved.